[Congressional Record Volume 149, Number 51 (Monday, March 31, 2003)]
[Senate]
[Pages S4558-S4577]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. DASCHLE (for Mr. Edwards):
  S. 743. A bill to designate a building that houses the operations of 
the University Park United States Postal Service in Charlotte, North 
Carolina, as the ``Jim Richardson Post Office Building''; to the 
Committee on Governmental Affairs.
  Mr. DASCHLE. Mr. President, I rise today to introduce the ``James F. 
Richardson Post Office Act of 2003.'' This measure would name the 
University Park Post Office in Charlotte, NC, after a man who has come 
to mean so much to the City of Charlotte, Mecklenburg County and the 
State of North Carolina. His record of public service goes back 60 
years.
  A Charlotte native, Jim Richardson graduated from Second War High 
School, the only high school in the area African Americans were allowed 
to attend. In a separate and unequal society he learned early on the 
importance of character and serving the public good. Our World War II 
veterans are said to be the greatest generation. As part of that 
generation Jim Richardson entered the United States Navy and served our 
country honorably in the South Pacific theater during World War II. It 
is with character and a deep

[[Page S4559]]

and abiding hope for a better future that a man such as Jim Richardson 
fought for his country only to return to a society that did not afford 
all that was allowed them under the Constitution of the United States.
  After the war, Jim returned to Charlotte and entered Johnson C. Smith 
University. He graduated with a degree in Physical Education and 
minored in General Sciences. His Post Office career began in 1949 as a 
postal clerk in Charlotte. With the railroads still being the dominant 
form of transporting the mail, Jim transferred to the Railway Postal 
Service. When he returned to the Charlotte Post Office years later he 
had risen through the ranks to having held several supervisory 
positions. With 33 years of service in the Federal Government, he 
retirement as the US Postmaster in Mt. Holly, NC.
  Now, that would be a full career for most individuals. What I have 
not mentioned is that Jim Richardson was an elected official having 
served distinguishably in both the North Carolina State House and State 
Senate. It was here that this man whose family taught him the mantra 
``do good for others and goodness will return to you'' continued his 
advocacy for those who needed it most. These were often the poor, 
minorities and the elderly. Jim's legislative record reflected his 
life's experiences. When he retired from the State Senate, he was a 
role model for elected officials of both parties. I include myself as 
being one who looks to Jim Richardson not on the issues of the day, but 
on the manner in which we conduct ourselves in the daily business of 
serving the people who elected us.
  Again, you would think this would be enough public service for most 
people. Not for Jim. He returned from the State Legislature to 
Charlotte and was elected as a Mecklenburg County Commissioner. I came 
to know him during this his third career. When I called on him for 
advice and counsel, he opened the wealth of his life's experiences to 
me. He also opened his home where I stayed during my campaign for the 
Senate seat. I learned from the man and about him. He and his wife Mary 
are revered for so many of their contributions to the community. Chief 
among them is their work on HIV/AIDS awareness among young people. 
Their hope is to save lives and spare families the experience of losing 
a loved one to this dreaded disease.
  There being no objection the bill was ordered to be printed in the 
Record, as follows:

                                 S. 743

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

     SECTION 1. DESIGNATION OF JIM RICHARDSON POST OFFICE 
                   BUILDING.

       The building that houses operations of the University Park 
     United States Postal Service, located at 2127 Beattys Ford 
     Road, in Charlotte, North Carolina (or any other building to 
     which the University Park United States Postal Service may 
     relocate after the date of enactment of this Act), shall be 
     known and designated as the ``Jim Richardson Post Office 
     Building''.

     SEC. 2. REFERENCES.

       Any reference in a law, map, regulation, document, paper, 
     or other record of the United States to the annex to the 
     building referred to in section 1 shall be deemed to be a 
     reference to the Jim Richardson Post Office Building.
                                 ______
                                 
      By Mrs. FEINSTEIN:
  S. 745. A bill to require the consent of an individual prior to the 
sale and marketing of such individual's personally identifiable 
information, and for other purposes; to the Committee on the Judiciary.
  Mrs. FEINSTEIN. Mr. President, I am pleased to introduce the 
``Privacy Act of 2003.''
  This legislation would establish, for the first time, a comprehensive 
national system of privacy protection.
  It would: require companies to gain consumers' written consent prior 
to selling their most sensitive personal information including personal 
health information, financial information, Social Security numbers, and 
drivers' license data; and require companies to provide consumers' 
notice and an opportunity to refuse to allow their less sensitive 
personal information to be sold.
  Simply put, this legislation would give consumers more control over 
how their personal information is used.
  The personal information of today's consumer is too vulnerable to 
abuse. With access to sensitive data so widely available--often just at 
the touch of a keyboard--it is easy to understand why identity theft 
has become one of the country's fastest growing crimes.
  Recent statistics on the growth of identity theft suggest we have no 
time to waste in protecting personal privacy.
  Identity theft is the number one consumer complaint reported to the 
Federal Trade Commission. American consumers filed approximately 
163,000 identity theft complaints with the FTC in 2002. Fully 43 
percent of all the complaints the FTC receives are about identity 
theft.
  An estimated 700,000 cases of identity theft occur each year. The 
average victim spends an average of 175 hours over a two-year period 
clearing off an average of $17,000 fraud off their credit reports.
  My own State, California, has more victims than any other state. The 
FTC recorded 30,738 identity theft cases last year from California 
consumers alone.
  While modern technology has increased the threat to personal security 
and privacy, the protections for individual privacy have not kept pace. 
Our country's privacy laws form an incomplete and inconsistent 
patchwork.
  For example, Americans enjoy the highest level of privacy protection 
concerning the names of the movies they rent at a video store. But, at 
the same time, it is perfectly legal to sell another person's Social 
Security number over the Internet.
  The Privacy Act would establish a Federal privacy standard that 
adjusts the level of privacy protection according to the sensitivity of 
the information at issue.
  The legislation provides the highest level of protection for a 
person's most sensitive data--personal financial data, health data, 
driver's license information, and Social Security numbers.
  For this sensitive data, the bill gives the individual ultimate 
control over whether or not his or her information is shared. If an 
individual does not actively decide to permit sharing of personal data, 
the data is not disclosed.
  Specifically, this legislation tightens the privacy provisions of the 
Financial Services Modernization Act, commonly known as the Gramm-
Leach-Bliley Act. Under Gramm-Leach-Bliley, a bank can share a 
customer's personal information with other companies so long as it 
gives consumers notice and the right to opt-out of the data sharing.
  The problem with opt-out is that most people toss out their privacy 
notices from banks along with the rest of the unrelenting pile of 
commercial solicitations they receive. Since the passage of Gramm-
Leach-Bliley, banks have sent out over one billion privacy notices.
  According to available published information, fewer than 5 percent of 
bank customers have opted out of sharing their personal information, 
and for many financial institutions, the response rate has been less 
than one percent.
  It is not surprising that consumers do not respond overwhelmingly to 
these notices, since, by some estimates, the average American household 
received a dozen of these notices. A consumer should not have the 
burden of constantly monitoring how his or her most sensitive personal 
information is shared with other companies.
  Accordingly, the Privacy Act prohibits the sale or disclosure of 
sensitive personal financial information to third parties unless the 
consumer affirmatively consents or opts in.
  This legislation also toughens Federal financial privacy laws for 
affiliate sharing and joint marketing. An affiliate is a company that 
is linked by common ownership with another company. Under Federal law, 
a bank can share with affiliates or joint marketing partners regardless 
of whether the consumer wants this information shared.
  The Privacy Act of 2003 would require that banks give consumers the 
option of opting out of the sharing of their personal financial 
information with the bank's affiliates or joint partners.
  Some banks argue that affiliates are just branches of an 
organization, and a bank should for efficiency purposes be able to 
share data within the entire organization. In an era where a bank had 
one or two affiliates, that might be true.
  But, now, some companies are so big that if a customer has no control 
over

[[Page S4560]]

affiliate sharing, then the customer is unable to prevent the 
disclosure of their data to hundreds of companies. For example, in 
recent testimony before Congress, U.S. PIRG reported that Citibank has 
2,761 affiliates, Key Bank had 871 affiliates, and Bank of America has 
1,576 affiliates.
  Similarly, a customer must be able to restrict a bank's sharing of 
personal information with its joint venture partners if the customer 
wants to maintain control over his personal information.
  I would also like to describe several other key components of the 
financial privacy section.
  The bill prohibits banks from denying a customer a financial product 
or financial service just because the customer chooses to not disclose 
his personal information to third parties, affiliates, or joint venture 
partners. However, the bill does allow banks to offer incentives to 
customers to encourage them to permit the sharing of their personal 
information.
  Additionally, the bill permits banks to disclose, but not sell, 
personal information to third parties for vital public interest 
purposes such as identifying or locating missing and abducted children, 
witnesses, criminals and fugitives, parents delinquent in child support 
payments, organ and bone marrow donors, pension fund beneficiaries, and 
missing heirs.
  Just as with financial data, personal health data deserves the most 
stringent privacy protections.
  The recently adopted Department of Health and Human Services privacy 
regulations set a basic opt-in framework for disclosure of health 
information. But more can be done to protect patient privacy.
  The regulations only prohibit ``covered entities''--namely health 
insurers, health providers, and health care clearinghouses--from 
selling a patient's health information without that patient's prior 
consent.
  Meanwhile, non-covered entities such as business associates, health 
researchers, schools or universities, and life insurers are not subject 
to this opt-in requirement, except through contractual arrangements.

  This legislation would preserve the privacy of health information 
wherever the information is sold. Any business associate, life insurer, 
school or non-covered entity trying to sell or market protected health 
information would, like covered entities, have to get the patient's 
prior consent.
  Drivers' license data also is given the strongest level of protection 
under this bill.
  With its recent amendments, the Driver's Privacy Protection Act, 
DPPA, offers some meaningful protections for drivers privacy.
  For example, under the DPPA, a State Department of Motor Vehicles 
must obtain the prior consent, Opt-in, of the driver before ``highly 
sensitive information''--defined as the driver's photograph, image, 
Social Security number, medical or disability information--can be 
disclosed to a third party.
  However, loopholes remain. Other sensitive information found on a 
driver's license deserves equal protection.
  The Privacy Act would expand the definition of ``highly sensitive 
information'' to include a physical copy of a driver's license, the 
driver identification number, birth date, information on the driver's 
physical characteristics and any biometric identifiers, such as a 
fingerprint, that are found on the driver's license.
  Thus, this bill would ensure consumers have control over how their 
motor vehicle records and driver's license data are used.
  I would like to take a moment to highlight the Social Security number 
section of the privacy bill, which reflects over four years of 
negotiation with Senator Hatch, Senator Gregg, Senator Grassley, 
Senator Baucus, and other Senate colleagues. I have also introduced 
this section as a stand-alone bill, Senate bill 228.
  It is crucial to protect Social Security numbers because the numbers 
are the key to a person's identity. Many identity theft cases start 
with the theft of a Social Security number. Once a thief has access to 
a victim's Social Security number, it is only a short step to acquiring 
credit cards, driver's licenses, or other crucial identification 
documents.
  Not surprisingly, members of the public have flooded our Federal 
agencies with pleas for assistance. Reports to the Social Security 
Administration of Social Security number misuse have increased from 
7,868 in 1997 to 73,000 in 2002--an astonishing increase of over 800%.
  The Feinstein/Gregg compromise bars the sale or display of Social 
Security numbers to the public except in a very narrow set of 
circumstances.
  Display or sale is permitted if the Social Security number holder 
consents or if there are compelling public safety needs.
  Government entities will have to redact Social Security numbers from 
electronic records that are readily available to the public on the 
Internet.
  Moreover, State governments will no longer be permitted to use the 
Social Security number as the default driver's license number.
  The legislation, however, recognizes that some industries rely on 
Social Security numbers to exchange information between databases and 
complete identification verification necessary for certain 
transactions.
  Thus, the bill directs the Attorney General to develop regulations 
allowing for the sale or purchase of Social Security Numbers to 
facilitate business-to-business and business-to-government transactions 
so long as businesses put appropriate safeguards in place and do not 
permit public access to the number.
  Recognizing that not all personal information merits the same 
restrictions, the bill permits businesses to collect and sell 
nonsensitive personal information, e.g., name, phone number, address, 
to third parties so long as they give customers notice and the 
opportunity to opt-out of the sale.
  The opt-out standard for non-sensitive information means that if a 
person fills out a warranty card, signs up for a computer service, or 
submits an entry for a sweepstakes, the business must notify him before 
it sells his personal information to other businesses or marketers.
  This framework guarantees basic privacy protections for consumers 
without unduly impacting commerce.
  To further minimize the regulatory burden of these privacy rules, the 
bill sets up a safe harbor so that industries and industry-sponsored 
seal programs which have already adopted Notice-and-Opt Out information 
policies, will be exempt from the regulatory requirements of the 
legislation.
  To ensure uniformity of the laws across all 50 states, the bill 
preempts inconsistent state laws regarding the treatment of non-
sensitive information.
  A jumbled patchwork of State privacy laws helps neither businesses 
nor consumers. Consumers will have confused expectations about what 
information is protected.
  Another distinguishing characteristic of the Privacy Act of 2003 is 
that it protects the privacy of information regardless of the medium 
through which it is collected.
  Other privacy proposals have tried to confine privacy legislation to 
the Internet.
  These proposals unfairly discriminate against high technology users. 
Put simply, companies and other entities can misuse personal 
information from off-line sources just as easily as with on-line 
sources.
  For example, telemarketers who besiege consumers with phone calls 
during the dinner hour do not typically get customer information from 
the Internet. Much of the identifying information used to make these 
calls comes from consumers filling out and mailing back warranty and 
registration cards.
  Regardless of how information is collected, it should get equal 
protection.
  This legislation codifies steps Congress can take to protect citizens 
from identity thieves and other predators of personal information.
  It restores to an individual more control over his or her most 
sensitive personal information such as Social Security numbers, health 
information, and financial information. It also sets reasonable 
guidelines for businesses that handle our personal information every 
day.
  A byproduct of our information economy--personal information is much 
more vulnerable to exploitation than ever before.
  Every American has a fundamental right to privacy, no matter how fast 
our technology grows or changes. A

[[Page S4561]]

person should be able to have control over how their most sensitive 
personal information is used.
  But our right to privacy only will remain vital, if we take strong 
action to protect it.
  I ask unanimous consent that the text of the legislation be printed 
in the Record.
  I look forward to working with my colleagues to enact the Privacy Act 
of 2003.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 745

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Privacy 
     Act of 2003''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title; table of contents.

   TITLE I--COMMERCIAL SALE AND MARKETING OF PERSONALLY IDENTIFIABLE 
                              INFORMATION

Sec. 101. Collection and distribution of personally identifiable 
              information.
Sec. 102. Enforcement.
Sec. 103. Safe harbor.
Sec. 104. Definitions.
Sec. 105. Preemption.
Sec. 106. Effective Date.

           TITLE II--SOCIAL SECURITY NUMBER MISUSE PREVENTION

Sec. 201. Findings.
Sec. 202. Prohibition of the display, sale, or purchase of social 
              security numbers.
Sec. 203. Application of prohibition of the display, sale, or purchase 
              of social security numbers to public records.
Sec. 204. Rulemaking authority of the Attorney General.
Sec. 205. Treatment of social security numbers on government documents.
Sec. 206. Limits on personal disclosure of a social security number for 
              consumer transactions.
Sec. 207. Extension of civil monetary penalties for misuse of a social 
              security number.
Sec. 208. Criminal penalties for the misuse of a social security 
              number.
Sec. 209. Civil actions and civil penalties.
Sec. 210. Federal injunctive authority.

   TITLE III--LIMITATIONS ON SALE AND SHARING OF NONPUBLIC PERSONAL 
                         FINANCIAL INFORMATION

Sec. 301. Definition of sale.
Sec. 302. Rules applicable to sale of nonpublic personal information.
Sec. 303. Exceptions to disclosure prohibition.
Sec. 304. Conforming amendments.
Sec. 305. Regulatory authority.
Sec. 306. Effective date.

 TITLE IV--LIMITATIONS ON THE PROVISION OF PROTECTED HEALTH INFORMATION

Sec. 401. Definitions.
Sec. 402. Prohibition against selling protected health information.
Sec. 403. Authorization for sale or marketing of protected health 
              information by noncovered entities.
Sec. 404. Prohibition against retaliation.
Sec. 405. Rule of construction.
Sec. 406. Regulations.
Sec. 407. Enforcement.

                   TITLE V--DRIVER'S LICENSE PRIVACY

Sec. 501. Driver's license privacy.

                        TITLE VI--MISCELLANEOUS

Sec. 601. Enforcement by State Attorneys General.
Sec. 602. Federal injunctive authority.

   TITLE I--COMMERCIAL SALE AND MARKETING OF PERSONALLY IDENTIFIABLE 
                              INFORMATION

     SEC. 101. COLLECTION AND DISTRIBUTION OF PERSONALLY 
                   IDENTIFIABLE INFORMATION.

       (a) Prohibition.--
       (1) In general.--It is unlawful for a commercial entity to 
     collect personally identifiable information and disclose such 
     information to any nonaffiliated third party for marketing 
     purposes or sell such information to any nonaffiliated third 
     party, unless the commercial entity provides--
       (A) notice to the individual to whom the information 
     relates in accordance with the requirements of subsection 
     (b); and
       (B) an opportunity for such individual to restrict the 
     disclosure or sale of such information.
       (2) Exception.--A commercial entity may collect personally 
     identifiable information and use such information to market 
     to potential customers such entity's product.
       (b) Notice.--
       (1) In general.--A notice under subsection (a) shall 
     contain statements describing the following:
       (A) The identity of the commercial entity collecting the 
     personally identifiable information.
       (B) The types of personally identifiable information that 
     are being collected on the individual.
       (C) How the commercial entity may use such information.
       (D) A description of the categories of potential recipients 
     of such personally identifiable information.
       (E) Whether the individual is required to provide 
     personally identifiable information in order to do business 
     with the commercial entity.
       (F) How an individual may decline to have such personally 
     identifiable information used or sold as described in 
     subsection (a).
       (2) Time of notice.--Notice shall be conveyed prior to the 
     sale or use of the personally identifiable information as 
     described in subsection (a) in such a manner as to allow the 
     individual a reasonable period of time to consider the notice 
     and limit such sale or use.
       (3) Medium of notice.--The medium for providing notice must 
     be--
       (A) the same medium in which the personally identifiable 
     information is or will be collected, or a medium approved by 
     the individual; or
       (B) in the case of oral communication, notice may be 
     conveyed orally or in writing.
       (4) Form of notice.--The notice shall be clear and 
     conspicuous.
       (c) Opt-Out.--
       (1) Opportunity to opt-out of sale or marketing.--The 
     opportunity provided to limit the sale of personally 
     identifiable information to nonaffiliated third parties or 
     the disclosure of such information for marketing purposes, 
     shall be easy to use, accessible and available in the medium 
     the information is collected, or in a medium approved by the 
     individual.
       (2) Duration of limitation.--An individual's limitation on 
     the sale or marketing of personally identifiable information 
     shall be considered permanent, unless otherwise specified by 
     the individual.
       (3) Revocation of consent.--After an individual grants 
     consent to the use of that individual's personally 
     identifiable information, the individual may revoke the 
     consent at any time, except to the extent that the commercial 
     entity has taken action in reliance thereon. The commercial 
     entity shall provide the individual an opportunity to revoke 
     consent that is easy to use, accessible, and available in the 
     medium the information was or is collected.
       (4) Not applicable.--This section shall not apply to 
     disclosure of personally identifiable information--
       (A) that is necessary to facilitate a transaction 
     specifically requested by the consumer;
       (B) is used for the sole purpose of facilitating this 
     transaction; and
       (C) in which the entity receiving or obtaining such 
     information is limited, by contract, to use such formation 
     for the purpose of completing the transaction.

     SEC. 102. ENFORCEMENT.

       (a) In General.--In accordance with the provisions of this 
     section, the Federal Trade Commission shall have the 
     authority to enforce any violation of section 101 of this 
     Act.
       (b) Violations.--The Federal Trade Commission shall treat a 
     violation of section 101 as a violation of a rule under 
     section 18a(a)(1)(B) of the Federal Trade Commission Act (15 
     U.S.C. 57a(a)(1)(B)).
       (c) Transfer of Enforcement Authority.--The Federal Trade 
     Commission shall promulgate rules in accordance with section 
     553 of title 5, United States Code, allowing for the transfer 
     of enforcement authority from the Federal Trade Commission to 
     a Federal agency regarding section 101 of this Act. The 
     Federal Trade Commission may permit a Federal agency to 
     enforce any violation of section 101 if such agency submits a 
     written request to the Commission to enforce such violations 
     and includes in such request--
       (1) a description of the entities regulated by such agency 
     that will be subject to the provisions of section 101;
       (2) an assurance that such agency has sufficient authority 
     over the entities to enforce violations of section 101; and
       (3) a list of proposed rules that such agency shall use in 
     regulating such entities and enforcing section 101.
       (d) Actions by the Commission.--Absent transfer of 
     enforcement authority to a Federal agency under subsection 
     (c), the Federal Trade Commission shall prevent any person 
     from violating section 101 in the same manner, by the same 
     means, and with the same jurisdiction, powers, and duties as 
     provided to such Commission under the Federal Trade 
     Commission Act (15 U.S.C. 41 et seq.). Any entity that 
     violates section 101 is subject to the penalties and entitled 
     to the privileges and immunities provided in such Act in the 
     same manner, by the same means, and with the same 
     jurisdiction, power, and duties under such Act.
       (e) Relationship to Other Laws.--
       (1) Commission authority.--Nothing contained in this title 
     shall be construed to limit authority provided to the 
     Commission under any other law.
       (2) Communications act.--Nothing in section 101 requires an 
     operator of a website to take any action that is inconsistent 
     with the requirements of section 222 or 631 of the 
     Communications Act of 1934 (47 U.S.C. 222 and 5551).
       (3) Other acts.--Nothing in this title is intended to 
     affect the applicability or the enforceability of any 
     provision of, or any amendment made by--
       (A) the Children's Online Privacy Protection Act of 1998 
     (15 U.S.C. 6501 et seq.);

[[Page S4562]]

       (B) title V of the Gramm-Leach-Bliley Act;
       (C) the Health Insurance Portability and Accountability Act 
     of 1996; or
       (D) the Fair Credit Reporting Act.
       (f) Public Records.--Nothing in this title shall be 
     construed to restrict commercial entities from obtaining or 
     disclosing personally identifying information from public 
     records.
       (g) Civil Penalties.--In addition to any other penalty 
     applicable to a violation of section 101(a), a penalty of up 
     to $25,000 may be issued for each violation.
       (h) Enforcement Regarding Programs.--
       (1) In general.--A Federal agency or department providing 
     financial assistance to any entity required to comply with 
     section 101 of this Act shall issue regulations requiring 
     that such entity comply with such section or forfeit some or 
     all of such assistance. Such regulations shall prescribe 
     sanctions for noncompliance, require that such department or 
     agency provide notice of failure to comply with such section 
     prior to any action being taken against such recipient, and 
     require that a determination be made prior to any action 
     being taken against such recipient that compliance cannot be 
     secured by voluntary means.
       (2) Federal financial assistance.--The term ``Federal 
     financial assistance'' means assistance through a grant, 
     cooperative agreement, loan, or contract other than a 
     contract of insurance or guaranty.

     SEC. 103. SAFE HARBOR.

       A commercial entity may not be held to have violated any 
     provision of this title if such entity complies with self-
     regulatory guidelines that--
       ``(1) are issued by seal programs or representatives of the 
     marketing or online industries or by any other person; and
       ``(2) are approved by the Federal Trade Commission, after 
     public comment has been received on such guidelines by the 
     Commission, as meeting the requirements of this title.

     SEC. 104. DEFINITIONS.

       In this title:
       (1) Commercial entity.--The term ``commercial entity''--
       (A) means any person offering products or services 
     involving commerce--
       (i) among the several States or with 1 or more foreign 
     nations;
       (ii) in any territory of the United States or in the 
     District of Columbia, or between any such territory and--

       (I) another such territory; or
       (II) any State or foreign nation; or

       (iii) between the District of Columbia and any State, 
     territory, or foreign nation; and
       (B) does not include--
       (i) any nonprofit entity that would otherwise be exempt 
     from coverage under section 5 of the Federal Trade Commission 
     Act (15 U.S.C. 45);
       (ii) any financial institution that is subject to title V 
     of the Gramm-Leach-Bliley Act (15 U.S.C. 6801 et seq.); or
       (iii) any group health plan, health insurance issuer, or 
     other entity that is subject to the Health Insurance 
     Portability and Accountability Act of 1996 (42 U.S.C. 201 
     note).
       (2) Commission.--The term ``Commission'' means the Federal 
     Trade Commission.
       (3) Individual.--The term ``individual'' means a person 
     whose personally identifying information has been, is, or 
     will be collected by a commercial entity.
       (4) Marketing.--The term ``marketing'' means to make a 
     communication about a product or service a purpose of which 
     is to encourage recipients of the communication to purchase 
     or use the product or service.
       (5) Medium.--The term ``medium'' means any channel or 
     system of communication including oral, written, and online 
     communication.
       (6) Nonaffiliated third party.--The term ``nonaffiliated 
     third party'' means any entity that is not related by common 
     ownership or affiliated by corporate control with, the 
     commercial entity, but does not include a joint employee of 
     such institution.
       (7) Personally identifiable information.--The term 
     ``personally identifiable information'' means individually 
     identifiable information about the individual that is 
     collected including--
       (A) a first, middle, or last name, whether given at birth 
     or adoption, assumed, or legally changed;
       (B) a home or other physical address, including the street 
     name, zip code, and name of a city or town;
       (C) an e-mail address;
       (D) a telephone number;
       (E) a photograph or other form of visual identification;
       (F) a birth date, birth certificate number, or place of 
     birth for that person; or
       (G) information concerning the individual that is combined 
     with any other identifier in this paragraph.
       (8) Sale; Sell; Sold.--The terms ``sale'', ``sell'', and 
     ``sold'', with respect to personally identifiable 
     information, mean the exchanging of such information for any 
     thing of value, directly or indirectly, including the 
     licensing, bartering, or renting of such information.
       (9) Writing.--The term ``writing'' means writing in either 
     a paper-based or computer-based form, including electronic 
     and digital signatures.

     SEC. 105. PREEMPTION.

       The provisions of this title shall supersede any statutory 
     and common law of States and their political subdivisions 
     insofar as that law may now or hereafter relate to the--
       (1) collection and disclosure of personally identifiable 
     information for marketing purposes; and
       (2) collection and sale of personally identifiable 
     information.

     SEC. 106. EFFECTIVE DATE.

       This title and the amendments made by this title shall take 
     effect 1 year after the date of enactment of this Act.

           TITLE II--SOCIAL SECURITY NUMBER MISUSE PREVENTION

     SEC. 201. FINDINGS.

       Congress makes the following findings:
       (1) The inappropriate display, sale, or purchase of social 
     security numbers has contributed to a growing range of 
     illegal activities, including fraud, identity theft, and, in 
     some cases, stalking and other violent crimes.
       (2) While financial institutions, health care providers, 
     and other entities have often used social security numbers to 
     confirm the identity of an individual, the general display to 
     the public, sale, or purchase of these numbers has been used 
     to commit crimes, and also can result in serious invasions of 
     individual privacy.
       (3) The Federal Government requires virtually every 
     individual in the United States to obtain and maintain a 
     social security number in order to pay taxes, to qualify for 
     social security benefits, or to seek employment. An 
     unintended consequence of these requirements is that social 
     security numbers have become one of the tools that can be 
     used to facilitate crime, fraud, and invasions of the privacy 
     of the individuals to whom the numbers are assigned. Because 
     the Federal Government created and maintains this system, and 
     because the Federal Government does not permit individuals to 
     exempt themselves from those requirements, it is appropriate 
     for the Federal Government to take steps to stem the abuse of 
     social security numbers.
       (4) The display, sale, or purchase of social security 
     numbers in no way facilitates uninhibited, robust, and wide-
     open public debate, and restrictions on such display, sale, 
     or purchase would not affect public debate.
       (5) No one should seek to profit from the display, sale, or 
     purchase of social security numbers in circumstances that 
     create a substantial risk of physical, emotional, or 
     financial harm to the individuals to whom those numbers are 
     assigned.
       (6) Consequently, this title provides each individual that 
     has been assigned a social security number some degree of 
     protection from the display, sale, and purchase of that 
     number in any circumstance that might facilitate unlawful 
     conduct.

     SEC. 202. PROHIBITION OF THE DISPLAY, SALE, OR PURCHASE OF 
                   SOCIAL SECURITY NUMBERS.

       (a) Prohibition.--
       (1) In general.--Chapter 47 of title 18, United States 
     Code, is amended by inserting after section 1028 the 
     following:

     ``Sec. 1028A. Prohibition of the display, sale, or purchase 
       of social security numbers

       ``(a) Definitions.--In this section:
       ``(1) Display.--The term `display' means to intentionally 
     communicate or otherwise make available (on the Internet or 
     in any other manner) to the general public an individual's 
     social security number.
       ``(2) Person.--The term `person' means any individual, 
     partnership, corporation, trust, estate, cooperative, 
     association, or any other entity.
       ``(3) Purchase.--The term `purchase' means providing 
     directly or indirectly, anything of value in exchange for a 
     social security number.
       ``(4) Sale.--The term `sale' means obtaining, directly or 
     indirectly, anything of value in exchange for a social 
     security number.
       ``(5) State.--The term `State' means any State of the 
     United States, the District of Columbia, Puerto Rico, the 
     Northern Mariana Islands, the United States Virgin Islands, 
     Guam, American Samoa, and any territory or possession of the 
     United States.
       ``(b) Limitation on Display.--Except as provided in section 
     1028B, no person may display any individual's social security 
     number to the general public without the affirmatively 
     expressed consent of the individual.
       ``(c) Limitation on Sale or Purchase.--Except as otherwise 
     provided in this section, no person may sell or purchase any 
     individual's social security number without the affirmatively 
     expressed consent of the individual.
       ``(d) Prerequisites for Consent.--In order for consent to 
     exist under subsection (b) or (c), the person displaying or 
     seeking to display, selling or attempting to sell, or 
     purchasing or attempting to purchase, an individual's social 
     security number shall--
       ``(1) inform the individual of the general purpose for 
     which the number will be used, the types of persons to whom 
     the number may be available, and the scope of transactions 
     permitted by the consent; and
       ``(2) obtain the affirmatively expressed consent 
     (electronically or in writing) of the individual.
       ``(e) Exceptions.--Nothing in this section shall be 
     construed to prohibit or limit the display, sale, or purchase 
     of a social security number--
       ``(1) required, authorized, or excepted under any Federal 
     law;
       ``(2) for a public health purpose, including the protection 
     of the health or safety of an individual in an emergency 
     situation;
       ``(3) for a national security purpose;

[[Page S4563]]

       ``(4) for a law enforcement purpose, including the 
     investigation of fraud and the enforcement of a child support 
     obligation;
       ``(5) if the display, sale, or purchase of the number is 
     for a use occurring as a result of an interaction between 
     businesses, governments, or business and government 
     (regardless of which entity initiates the interaction), 
     including, but not limited to--
       ``(A) the prevention of fraud (including fraud in 
     protecting an employee's right to employment benefits);
       ``(B) the facilitation of credit checks or the facilitation 
     of background checks of employees, prospective employees, or 
     volunteers;
       ``(C) the retrieval of other information from other 
     businesses, commercial enterprises, government entities, or 
     private nonprofit organizations; or
       ``(D) when the transmission of the number is incidental to, 
     and in the course of, the sale, lease, franchising, or merger 
     of all, or a portion of, a business;
       ``(6) if the transfer of such a number is part of a data 
     matching program involving a Federal, State, or local agency; 
     or
       ``(7) if such number is required to be submitted as part of 
     the process for applying for any type of Federal, State, or 
     local government benefit or program;

     except that, nothing in this subsection shall be construed as 
     permitting a professional or commercial user to display or 
     sell a social security number to the general public.
       ``(f) Limitation.--Nothing in this section shall prohibit 
     or limit the display, sale, or purchase of social security 
     numbers as permitted under title V of the Gramm-Leach-Bliley 
     Act, or for the purpose of affiliate sharing as permitted 
     under the Fair Credit Reporting Act, except that no entity 
     regulated under such Acts may make social security numbers 
     available to the general public, as may be determined by the 
     appropriate regulators under such Acts. For purposes of this 
     subsection, the general public shall not include affiliates 
     or unaffiliated third-party business entities as may be 
     defined by the appropriate regulators.''.
       (2) Conforming Amendment.--The chapter analysis for chapter 
     47 of title 18, United States Code, is amended by inserting 
     after the item relating to section 1028 the following:

``1028A. Prohibition of the display, sale, or purchase of social 
              security numbers.''.
       (b) Study; Report.--
       (1) In general.--The Attorney General shall conduct a study 
     and prepare a report on all of the uses of social security 
     numbers permitted, required, authorized, or excepted under 
     any Federal law. The report shall include a detailed 
     description of the uses allowed as of the date of enactment 
     of this Act and shall evaluate whether such uses should be 
     continued or discontinued by appropriate legislative action.
       (2) Report.--Not later than 1 year after the date of 
     enactment of this Act, the Attorney General shall report to 
     Congress findings under this subsection. The report shall 
     include such recommendations for legislation based on 
     criteria the Attorney General determines to be appropriate.
       (c) Effective Date.--The amendments made by this section 
     shall take effect on the date that is 30 days after the date 
     on which the final regulations promulgated under section 5 
     are published in the Federal Register.

     SEC. 203. APPLICATION OF PROHIBITION OF THE DISPLAY, SALE, OR 
                   PURCHASE OF SOCIAL SECURITY NUMBERS TO PUBLIC 
                   RECORDS.

       (a) Public Records Exception.--
       (1) In general.--Chapter 47 of title 18, United States Code 
     (as amended by section 3(a)(1)), is amended by inserting 
     after section 1028A the following:

     ``Sec. 1028B. Display, sale, or purchase of public records 
       containing social security numbers

       ``(a) Definition.--In this section, the term `public 
     record' means any governmental record that is made available 
     to the general public.
       ``(b) In General.--Except as provided in subsections (c), 
     (d), and (e), section 1028A shall not apply to a public 
     record.
       ``(c) Public Records on the Internet or in an Electronic 
     Medium.--
       ``(1) In general.--Section 1028A shall apply to any public 
     record first posted onto the Internet or provided in an 
     electronic medium by, or on behalf of a government entity 
     after the date of enactment of this section, except as 
     limited by the Attorney General in accordance with paragraph 
     (2).
       ``(2) Exception for government entities already placing 
     public records on the internet or in electronic form.--Not 
     later than 60 days after the date of enactment of this 
     section, the Attorney General shall issue regulations 
     regarding the applicability of section 1028A to any record of 
     a category of public records first posted onto the Internet 
     or provided in an electronic medium by, or on behalf of a 
     government entity prior to the date of enactment of this 
     section. The regulations will determine which individual 
     records within categories of records of these government 
     entities, if any, may continue to be posted on the Internet 
     or in electronic form after the effective date of this 
     section. In promulgating these regulations, the Attorney 
     General may include in the regulations a set of procedures 
     for implementing the regulations and shall consider the 
     following:
       ``(A) The cost and availability of technology available to 
     a governmental entity to redact social security numbers from 
     public records first provided in electronic form after the 
     effective date of this section.
       ``(B) The cost or burden to the general public, businesses, 
     commercial enterprises, non-profit organizations, and to 
     Federal, State, and local governments of complying with 
     section 1028A with respect to such records.
       ``(C) The benefit to the general public, businesses, 
     commercial enterprises, non-profit organizations, and to 
     Federal, State, and local governments if the Attorney General 
     were to determine that section 1028A should apply to such 
     records.

     Nothing in the regulation shall permit a public entity to 
     post a category of public records on the Internet or in 
     electronic form after the effective date of this section if 
     such category had not been placed on the Internet or in 
     electronic form prior to such effective date.
       ``(d) Harvested Social Security Numbers.--Section 1028A 
     shall apply to any public record of a government entity which 
     contains social security numbers extracted from other public 
     records for the purpose of displaying or selling such numbers 
     to the general public.
       ``(e) Attorney General Rulemaking on Paper Records.--
       ``(1) In general.--Not later than 60 days after the date of 
     enactment of this section, the Attorney General shall 
     determine the feasibility and advisability of applying 
     section 1028A to the records listed in paragraph (2) when 
     they appear on paper or on another nonelectronic medium. If 
     the Attorney General deems it appropriate, the Attorney 
     General may issue regulations applying section 1028A to such 
     records.
       ``(2) List of paper and other nonelectronic records.--The 
     records listed in this paragraph are as follows:
       ``(A) Professional or occupational licenses.
       ``(B) Marriage licenses.
       ``(C) Birth certificates.
       ``(D) Death certificates.
       ``(E) Other short public documents that display a social 
     security number in a routine and consistent manner on the 
     face of the document.
       ``(3) Criteria for attorney general review.--In determining 
     whether section 1028A should apply to the records listed in 
     paragraph (2), the Attorney General shall consider the 
     following:
       ``(A) The cost or burden to the general public, businesses, 
     commercial enterprises, non-profit organizations, and to 
     Federal, State, and local governments of complying with 
     section 1028A.
       ``(B) The benefit to the general public, businesses, 
     commercial enterprises, non-profit organizations, and to 
     Federal, State, and local governments if the Attorney General 
     were to determine that section 1028A should apply to such 
     records.''.
       (2) Conforming Amendment.--The chapter analysis for chapter 
     47 of title 18, United States Code (as amended by section 
     202(a)(2)), is amended by inserting after the item relating 
     to section 1028A the following:

``1028B. Display, sale, or purchase of public records containing social 
              security numbers.''.
       (b) Study and Report on Social Security Numbers in Public 
     Records.--
       (1) Study.--The Comptroller General of the United States 
     shall conduct a study and prepare a report on social security 
     numbers in public records. In developing the report, the 
     Comptroller General shall consult with the Administrative 
     Office of the United States Courts, State and local 
     governments that store, maintain, or disseminate public 
     records, and other stakeholders, including members of the 
     private sector who routinely use public records that contain 
     social security numbers.
       (2) Report.--Not later than 1 year after the date of 
     enactment of this Act, the Comptroller General of the United 
     States shall submit to Congress a report on the study 
     conducted under paragraph (1). The report shall include a 
     detailed description of the activities and results of the 
     study and recommendations for such legislative action as the 
     Comptroller General considers appropriate. The report, at a 
     minimum, shall include--
       (A) a review of the uses of social security numbers in non-
     federal public records;
       (B) a review of the manner in which public records are 
     stored (with separate reviews for both paper records and 
     electronic records);
       (C) a review of the advantages or utility of public records 
     that contain social security numbers, including the utility 
     for law enforcement, and for the promotion of homeland 
     security;
       (D) a review of the disadvantages or drawbacks of public 
     records that contain social security numbers, including 
     criminal activity, compromised personal privacy, or threats 
     to homeland security;
       (E) the costs and benefits for State and local governments 
     of removing social security numbers from public records, 
     including a review of current technologies and procedures for 
     removing social security numbers from public records; and
       (F) an assessment of the benefits and costs to businesses, 
     their customers, and the general public of prohibiting the 
     display of social security numbers on public records (with 
     separate assessments for both paper records and electronic 
     records).
       (c) Effective Date.--The prohibition with respect to 
     electronic versions of new classes of public records under 
     section 1028B(b) of title 18, United States Code (as added by 
     subsection (a)(1)) shall not take effect until the

[[Page S4564]]

     date that is 60 days after the date of enactment of this Act.

     SEC. 204. RULEMAKING AUTHORITY OF THE ATTORNEY GENERAL.

       (a) In General.--Except as provided in subsection (b), the 
     Attorney General may prescribe such rules and regulations as 
     the Attorney General deems necessary to carry out the 
     provisions of section 1028A(e)(5) of title 18, United States 
     Code (as added by section 202(a)(1)).
       (b) Display, Sale, or Purchase Rulemaking With Respect to 
     Interactions Between Businesses, Governments, or Business and 
     Government.--
       (1) In general.--Not later than 1 year after the date of 
     enactment of this Act, the Attorney General, in consultation 
     with the Commissioner of Social Security, the Chairman of the 
     Federal Trade Commission, and such other heads of Federal 
     agencies as the Attorney General determines appropriate, 
     shall conduct such rulemaking procedures in accordance with 
     subchapter II of chapter 5 of title 5, United States Code, as 
     are necessary to promulgate regulations to implement and 
     clarify the uses occurring as a result of an interaction 
     between businesses, governments, or business and government 
     (regardless of which entity initiates the interaction) 
     permitted under section 1028A(e)(5) of title 18, United 
     States Code (as added by section 202(a)(1)).
       (2) Factors to be considered.--In promulgating the 
     regulations required under paragraph (1), the Attorney 
     General shall, at a minimum, consider the following:
       (A) The benefit to a particular business, to customers of 
     the business, and to the general public of the display, sale, 
     or purchase of an individual's social security number.
       (B) The costs that businesses, customers of businesses, and 
     the general public may incur as a result of prohibitions on 
     the display, sale, or purchase of social security numbers.
       (C) The risk that a particular business practice will 
     promote the use of a social security number to commit fraud, 
     deception, or crime.
       (D) The presence of adequate safeguards and procedures to 
     prevent--
       (i) misuse of social security numbers by employees within a 
     business; and
       (ii) misappropriation of social security numbers by the 
     general public, while permitting internal business uses of 
     such numbers.
       (E) The presence of procedures to prevent identity thieves, 
     stalkers, and other individuals with ill intent from posing 
     as legitimate businesses to obtain social security numbers.

     SEC. 205. TREATMENT OF SOCIAL SECURITY NUMBERS ON GOVERNMENT 
                   DOCUMENTS.

       (a) Prohibition of Use of Social Security Account Numbers 
     on Checks Issued for Payment by Governmental Agencies.--
       (1) In general.--Section 205(c)(2)(C) of the Social 
     Security Act (42 U.S.C. 405(c)(2)(C)) is amended by adding at 
     the end the following:
       ``(x) No Federal, State, or local agency may display the 
     social security account number of any individual, or any 
     derivative of such number, on any check issued for any 
     payment by the Federal, State, or local agency.''.
       (2) Effective date.--The amendment made by this subsection 
     shall apply with respect to violations of section 
     205(c)(2)(C)(x) of the Social Security Act (42 U.S.C. 
     405(c)(2)(C)(x)), as added by paragraph (1), occurring after 
     the date that is 3 years after the date of enactment of this 
     Act.
       (b) Prohibition of Appearance of Social Security Account 
     Numbers on Driver's Licenses or Motor Vehicle Registration.--
       (1) In general.--Section 205(c)(2)(C)(vi) of the Social 
     Security Act (42 U.S.C. 405(c)(2)(C)(vi)) is amended--
       (A) by inserting ``(I)'' after ``(vi)''; and
       (B) by adding at the end the following:
       ``(II)(aa) An agency of a State (or political subdivision 
     thereof), in the administration of any driver's license or 
     motor vehicle registration law within its jurisdiction, may 
     not display the social security account numbers issued by the 
     Commissioner of Social Security, or any derivative of such 
     numbers, on the face of any driver's license or motor vehicle 
     registration or any other document issued by such State (or 
     political subdivision thereof) to an individual for purposes 
     of identification of such individual.
       ``(bb) Nothing in this subclause shall be construed as 
     precluding an agency of a State (or political subdivision 
     thereof), in the administration of any driver's license or 
     motor vehicle registration law within its jurisdiction, from 
     using a social security account number for an internal use or 
     to link with the database of an agency of another State that 
     is responsible for the administration of any driver's license 
     or motor vehicle registration law.''.
       (2) Effective date.--The amendments made by this subsection 
     shall apply with respect to licenses, registrations, and 
     other documents issued or reissued after the date that is 1 
     year after the date of enactment of this Act.
       (c) Prohibition of Inmate Access to Social Security Account 
     Numbers.--
       (1) In general.--Section 205(c)(2)(C) of the Social 
     Security Act (42 U.S.C. 405(c)(2)(C)) (as amended by 
     subsection (b)) is amended by adding at the end the 
     following:
       ``(xi) No Federal, State, or local agency may employ, or 
     enter into a contract for the use or employment of, prisoners 
     in any capacity that would allow such prisoners access to the 
     social security account numbers of other individuals. For 
     purposes of this clause, the term `prisoner' means an 
     individual confined in a jail, prison, or other penal 
     institution or correctional facility pursuant to such 
     individual's conviction of a criminal offense.''.
       (2) Effective date.--The amendment made by this subsection 
     shall apply with respect to employment of prisoners, or entry 
     into contract with prisoners, after the date that is 1 year 
     after the date of enactment of this Act.

     SEC. 206. LIMITS ON PERSONAL DISCLOSURE OF A SOCIAL SECURITY 
                   NUMBER FOR CONSUMER TRANSACTIONS.

       (a) In General.--Part A of title XI of the Social Security 
     Act (42 U.S.C. 1301 et seq.) is amended by adding at the end 
     the following:

     ``SEC. 1150A. LIMITS ON PERSONAL DISCLOSURE OF A SOCIAL 
                   SECURITY NUMBER FOR CONSUMER TRANSACTIONS.

       ``(a) In General.--A commercial entity may not require an 
     individual to provide the individual's social security number 
     when purchasing a commercial good or service or deny an 
     individual the good or service for refusing to provide that 
     number except--
       ``(1) for any purpose relating to--
       ``(A) obtaining a consumer report for any purpose permitted 
     under the Fair Credit Reporting Act;
       ``(B) a background check of the individual conducted by a 
     landlord, lessor, employer, voluntary service agency, or 
     other entity as determined by the Attorney General;
       ``(C) law enforcement; or
       ``(D) a Federal, State, or local law requirement; or
       ``(2) if the social security number is necessary to verify 
     the identity of the consumer to effect, administer, or 
     enforce the specific transaction requested or authorized by 
     the consumer, or to prevent fraud.
       ``(b) Application of Civil Money Penalties.--A violation of 
     this section shall be deemed to be a violation of section 
     1129(a)(3)(F).
       ``(c) Application of Criminal Penalties.--A violation of 
     this section shall be deemed to be a violation of section 
     208(a)(8).
       ``(d) Limitation on Class Actions.--No class action 
     alleging a violation of this section shall be maintained 
     under this section by an individual or any private party in 
     Federal or State court.
       ``(e) State Attorney General Enforcement.--
       ``(1) In general.--
       ``(A) Civil actions.--In any case in which the attorney 
     general of a State has reason to believe that an interest of 
     the residents of that State has been or is threatened or 
     adversely affected by the engagement of any person in a 
     practice that is prohibited under this section, the State, as 
     parens patriae, may bring a civil action on behalf of the 
     residents of the State in a district court of the United 
     States of appropriate jurisdiction to--
       ``(i) enjoin that practice;
       ``(ii) enforce compliance with such section;
       ``(iii) obtain damages, restitution, or other compensation 
     on behalf of residents of the State; or
       ``(iv) obtain such other relief as the court may consider 
     appropriate.
       ``(B) Notice.--
       ``(i) In general.--Before filing an action under 
     subparagraph (A), the attorney general of the State involved 
     shall provide to the Attorney General--

       ``(I) written notice of the action; and
       ``(II) a copy of the complaint for the action.

       ``(ii) Exemption.--

       ``(I) In general.--Clause (i) shall not apply with respect 
     to the filing of an action by an attorney general of a State 
     under this subsection, if the State attorney general 
     determines that it is not feasible to provide the notice 
     described in such subparagraph before the filing of the 
     action.
       ``(II) Notification.--With respect to an action described 
     in subclause (I), the attorney general of a State shall 
     provide notice and a copy of the complaint to the Attorney 
     General at the same time as the State attorney general files 
     the action.

       ``(2) Intervention.--
       ``(A) In general.--On receiving notice under paragraph 
     (1)(B), the Attorney General shall have the right to 
     intervene in the action that is the subject of the notice.
       ``(B) Effect of intervention.--If the Attorney General 
     intervenes in the action under paragraph (1), the Attorney 
     General shall have the right to be heard with respect to any 
     matter that arises in that action.
       ``(3) Construction.--For purposes of bringing any civil 
     action under paragraph (1), nothing in this section shall be 
     construed to prevent an attorney general of a State from 
     exercising the powers conferred on such attorney general by 
     the laws of that State to--
       ``(A) conduct investigations;
       ``(B) administer oaths or affirmations; or
       ``(C) compel the attendance of witnesses or the production 
     of documentary and other evidence.
       ``(4) Actions by the attorney general of the united 
     states.--In any case in which an action is instituted by or 
     on behalf of the Attorney General for violation of a practice 
     that is prohibited under this section, no State may, during 
     the pendency of that action, institute an action under 
     paragraph (1) against any defendant named in the complaint in 
     that action for violation of that practice.
       ``(5) Venue; service of process.--
       ``(A) Venue.--Any action brought under paragraph (1) may be 
     brought in the district court of the United States that meets 
     applicable requirements relating to venue under section 1391 
     of title 28, United States Code.

[[Page S4565]]

       ``(B) Service of process.--In an action brought under 
     paragraph (1), process may be served in any district in which 
     the defendant--
       ``(i) is an inhabitant; or
       ``(ii) may be found.
       ``(f) Sunset.--This section shall not apply on or after the 
     date that is 6 years after the effective date of this 
     section.''.
       (b) Evaluation and Report.--Not later than the date that is 
     6 years and 6 months after the date of enactment of this Act, 
     the Attorney General, in consultation with the chairman of 
     the Federal Trade Commission, shall issue a report evaluating 
     the effectiveness and efficiency of section 1150A of the 
     Social Security Act (as added by subsection (a)) and shall 
     make recommendations to Congress as to any legislative action 
     determined to be necessary or advisable with respect to such 
     section, including a recommendation regarding whether to 
     reauthorize such section.
       (c) Effective Date.--The amendment made by subsection (a) 
     shall apply to requests to provide a social security number 
     occurring after the date that is 1 year after the date of 
     enactment of this Act.

     SEC. 207. EXTENSION OF CIVIL MONETARY PENALTIES FOR MISUSE OF 
                   A SOCIAL SECURITY NUMBER.

       (a) Treatment of Withholding of Material Facts.--
       (1) Civil penalties.--The first sentence of section 
     1129(a)(1) of the Social Security Act (42 U.S.C. 1320a-
     8(a)(1)) is amended--
       (A) by striking ``who'' and inserting ``who--'';
       (B) by striking ``makes'' and all that follows through 
     ``shall be subject to'' and inserting the following:
       ``(A) makes, or causes to be made, a statement or 
     representation of a material fact, for use in determining any 
     initial or continuing right to or the amount of monthly 
     insurance benefits under title II or benefits or payments 
     under title VIII or XVI, that the person knows or should know 
     is false or misleading;
       ``(B) makes such a statement or representation for such use 
     with knowing disregard for the truth; or
       ``(C) omits from a statement or representation for such 
     use, or otherwise withholds disclosure of, a fact which the 
     individual knows or should know is material to the 
     determination of any initial or continuing right to or the 
     amount of monthly insurance benefits under title II or 
     benefits or payments under title VIII or XVI and the 
     individual knows, or should know, that the statement or 
     representation with such omission is false or misleading or 
     that the withholding of such disclosure is misleading,

     shall be subject to'';
       (C) by inserting ``or each receipt of such benefits while 
     withholding disclosure of such fact'' after ``each such 
     statement or representation'';
       (D) by inserting ``or because of such withholding of 
     disclosure of a material fact'' after ``because of such 
     statement or representation''; and
       (E) by inserting ``or such a withholding of disclosure'' 
     after ``such a statement or representation''.
       (2) Administrative procedure for imposing penalties.--The 
     first sentence of section 1129A(a) of the Social Security Act 
     (42 U.S.C. 1320a-8a(a)) is amended--
       (A) by striking ``who'' and inserting ``who--''; and
       (B) by striking ``makes'' and all that follows through 
     ``shall be subject to'' and inserting the following:
       ``(1) makes, or causes to be made, a statement or 
     representation of a material fact, for use in determining any 
     initial or continuing right to or the amount of monthly 
     insurance benefits under title II or benefits or payments 
     under title VIII or XVI, that the person knows or should know 
     is false or misleading;
       ``(2) makes such a statement or representation for such use 
     with knowing disregard for the truth; or
       ``(3) omits from a statement or representation for such 
     use, or otherwise withholds disclosure of, a fact which the 
     individual knows or should know is material to the 
     determination of any initial or continuing right to or the 
     amount of monthly insurance benefits under title II or 
     benefits or payments under title VIII or XVI and the 
     individual knows, or should know, that the statement or 
     representation with such omission is false or misleading or 
     that the withholding of such disclosure is misleading,

     shall be subject to''.
       (b) Application of Civil Money Penalties to Elements of 
     Criminal Violations.--Section 1129(a) of the Social Security 
     Act (42 U.S.C. 1320a-8(a)), as amended by subsection (a)(1), 
     is amended--
       (1) by redesignating paragraph (2) as paragraph (4);
       (2) by redesignating the last sentence of paragraph (1) as 
     paragraph (2) and inserting such paragraph after paragraph 
     (1); and
       (3) by inserting after paragraph (2) (as so redesignated) 
     the following:
       ``(3) Any person (including an organization, agency, or 
     other entity) who--
       ``(A) uses a social security account number that such 
     person knows or should know has been assigned by the 
     Commissioner of Social Security (in an exercise of authority 
     under section 205(c)(2) to establish and maintain records) on 
     the basis of false information furnished to the Commissioner 
     by any person;
       ``(B) falsely represents a number to be the social security 
     account number assigned by the Commissioner of Social 
     Security to any individual, when such person knows or should 
     know that such number is not the social security account 
     number assigned by the Commissioner to such individual;
       ``(C) knowingly alters a social security card issued by the 
     Commissioner of Social Security, or possesses such a card 
     with intent to alter it;
       ``(D) knowingly displays, sells, or purchases a card that 
     is, or purports to be, a card issued by the Commissioner of 
     Social Security, or possesses such a card with intent to 
     display, purchase, or sell it;
       ``(E) counterfeits a social security card, or possesses a 
     counterfeit social security card with intent to display, 
     sell, or purchase it;
       ``(F) discloses, uses, compels the disclosure of, or 
     knowingly displays, sells, or purchases the social security 
     account number of any person in violation of the laws of the 
     United States;
       ``(G) with intent to deceive the Commissioner of Social 
     Security as to such person's true identity (or the true 
     identity of any other person) furnishes or causes to be 
     furnished false information to the Commissioner with respect 
     to any information required by the Commissioner in connection 
     with the establishment and maintenance of the records 
     provided for in section 205(c)(2);
       ``(H) offers, for a fee, to acquire for any individual, or 
     to assist in acquiring for any individual, an additional 
     social security account number or a number which purports to 
     be a social security account number; or
       ``(I) being an officer or employee of a Federal, State, or 
     local agency in possession of any individual's social 
     security account number, willfully acts or fails to act so as 
     to cause a violation by such agency of clause (vi)(II) or (x) 
     of section 205(c)(2)(C),

     shall be subject to, in addition to any other penalties that 
     may be prescribed by law, a civil money penalty of not more 
     than $5,000 for each violation. Such person shall also be 
     subject to an assessment, in lieu of damages sustained by the 
     United States resulting from such violation, of not more than 
     twice the amount of any benefits or payments paid as a result 
     of such violation.''.
       (c) Clarification of Treatment of Recovered Amounts.--
     Section 1129(e)(2)(B) of the Social Security Act (42 U.S.C. 
     1320a-8(e)(2)(B)) is amended by striking ``In the case of 
     amounts recovered arising out of a determination relating to 
     title VIII or XVI,'' and inserting ``In the case of any other 
     amounts recovered under this section,''.
       (d) Conforming Amendments.--
       (1) Section 1129(b)(3)(A) of the Social Security Act (42 
     U.S.C. 1320a-8(b)(3)(A)) is amended by striking ``charging 
     fraud or false statements''.
       (2) Section 1129(c)(1) of the Social Security Act (42 
     U.S.C. 1320a-8(c)(1)) is amended by striking ``and 
     representations'' and inserting ``, representations, or 
     actions''.
       (3) Section 1129(e)(1)(A) of the Social Security Act (42 
     U.S.C. 1320a-8(e)(1)(A)) is amended by striking ``statement 
     or representation referred to in subsection (a) was made'' 
     and inserting ``violation occurred''.
       (e) Effective Dates.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall apply with respect to 
     violations of sections 1129 and 1129A of the Social Security 
     Act (42 U.S.C. 1320-8 and 1320a-8a), as amended by this 
     section, committed after the date of enactment of this Act.
       (2) Violations by government agents in possession of social 
     security numbers.--Section 1129(a)(3)(I) of the Social 
     Security Act (42 U.S.C. 1320a-8(a)(3)(I)), as added by 
     subsection (b), shall apply with respect to violations of 
     that section occurring on or after the effective date 
     described in section 202(c).

     SEC. 208. CRIMINAL PENALTIES FOR THE MISUSE OF A SOCIAL 
                   SECURITY NUMBER.

       (a) Prohibition of Wrongful Use as Personal Identification 
     Number.--No person may obtain any individual's social 
     security number for purposes of locating or identifying an 
     individual with the intent to physically injure, harm, or use 
     the identity of the individual for any illegal purpose.
       (b) Criminal Sanctions.--Section 208(a) of the Social 
     Security Act (42 U.S.C. 408(a)) is amended--
       (1) in paragraph (8), by inserting ``or'' after the 
     semicolon; and
       (2) by inserting after paragraph (8) the following:
       ``(9) except as provided in subsections (e) and (f) of 
     section 1028A of title 18, United States Code, knowingly and 
     willfully displays, sells, or purchases (as those terms are 
     defined in section 1028A(a) of title 18, United States Code) 
     any individual's social security account number without 
     having met the prerequisites for consent under section 
     1028A(d) of title 18, United States Code; or
       ``(10) obtains any individual's social security number for 
     the purpose of locating or identifying the individual with 
     the intent to injure or to harm that individual, or to use 
     the identity of that individual for an illegal purpose;''.

     SEC. 209. CIVIL ACTIONS AND CIVIL PENALTIES.

       (a) Civil Action in State Courts.--
       (1) In general.--Any individual aggrieved by an act of any 
     person in violation of this title or any amendments made by 
     this title may, if otherwise permitted by the laws or rules 
     of the court of a State, bring in an appropriate court of 
     that State--
       (A) an action to enjoin such violation;

[[Page S4566]]

       (B) an action to recover for actual monetary loss from such 
     a violation, or to receive up to $500 in damages for each 
     such violation, whichever is greater; or
       (C) both such actions.

     It shall be an affirmative defense in any action brought 
     under this paragraph that the defendant has established and 
     implemented, with due care, reasonable practices and 
     procedures to effectively prevent violations of the 
     regulations prescribed under this title. If the court finds 
     that the defendant willfully or knowingly violated the 
     regulations prescribed under this subsection, the court may, 
     in its discretion, increase the amount of the award to an 
     amount equal to not more than 3 times the amount available 
     under subparagraph (B).
       (2) Statute of limitations.--An action may be commenced 
     under this subsection not later than the earlier of--
       (A) 5 years after the date on which the alleged violation 
     occurred; or
       (B) 3 years after the date on which the alleged violation 
     was or should have been reasonably discovered by the 
     aggrieved individual.
       (3) Nonexclusive remedy.--The remedy provided under this 
     subsection shall be in addition to any other remedies 
     available to the individual.
       (b) Civil Penalties.--
       (1) In general.--Any person who the Attorney General 
     determines has violated any section of this title or of any 
     amendments made by this title shall be subject, in addition 
     to any other penalties that may be prescribed by law--
       (A) to a civil penalty of not more than $5,000 for each 
     such violation; and
       (B) to a civil penalty of not more than $50,000, if the 
     violations have occurred with such frequency as to constitute 
     a general business practice.
       (2) Determination of violations.--Any willful violation 
     committed contemporaneously with respect to the social 
     security numbers of 2 or more individuals by means of mail, 
     telecommunication, or otherwise, shall be treated as a 
     separate violation with respect to each such individual.
       (3) Enforcement procedures.--The provisions of section 
     1128A of the Social Security Act (42 U.S.C. 1320a-7a), other 
     than subsections (a), (b), (f), (h), (i), (j), (m), and (n) 
     and the first sentence of subsection (c) of such section, and 
     the provisions of subsections (d) and (e) of section 205 of 
     such Act (42 U.S.C. 405) shall apply to a civil penalty 
     action under this subsection in the same manner as such 
     provisions apply to a penalty or proceeding under section 
     1128A(a) of such Act (42 U.S.C. 1320a-7a(a)), except that, 
     for purposes of this paragraph, any reference in section 
     1128A of such Act (42 U.S.C. 1320a-7a) to the Secretary shall 
     be deemed to be a reference to the Attorney General.

     SEC. 210. FEDERAL INJUNCTIVE AUTHORITY.

       In addition to any other enforcement authority conferred 
     under this title or the amendments made by this title, the 
     Federal Government shall have injunctive authority with 
     respect to any violation by a public entity of any provision 
     of this title or of any amendments made by this title.

   TITLE III--LIMITATIONS ON SALE AND SHARING OF NONPUBLIC PERSONAL 
                         FINANCIAL INFORMATION

     SEC. 301. DEFINITION OF SALE.

       Section 509 of the Gramm-Leach-Bliley Act (15 U.S.C. 6809) 
     is amended by adding at the end the following:
       ``(12) Sale.--The terms `sale', `sell', and `sold', with 
     respect to nonpublic personal information, mean the exchange 
     of such information for any thing of value, directly or 
     indirectly, including the licensing, bartering, or renting of 
     such information.''.

     SEC. 302. RULES APPLICABLE TO SALE OF NONPUBLIC PERSONAL 
                   INFORMATION.

       Section 502 of the Gramm-Leach-Bliley Act (15 U.S.C. 6802) 
     is amended--
       (1) in the section heading, by inserting ``SALES, AND OTHER 
     SHARING'' after ``DISCLOSURES'';
       (2) in subsection (a), by striking ``disclose to'' and 
     inserting ``sell or otherwise disclose to an affiliate or'';
       (3) in subsection (b)--
       (A) in the subsection heading, by inserting ``for 
     Disclosures to Affiliates'' before the period;
       (B) by striking ``a nonaffiliated third party'' each place 
     that term appears and inserting ``an affiliate'';
       (C) by striking ``such third party'' each place that term 
     appears and inserting ``such affiliate'';
       (D) by striking ``may not disclose'' and inserting ``may 
     not sell or otherwise disclose''; and
       (E) by striking paragraph (2) and inserting the following:
       ``(2) Exception.--This subsection shall not prevent a 
     financial institution from providing nonpublic personal 
     information to an affiliated third party to perform services 
     for or functions on behalf of the financial institution, 
     including marketing of the financial institution's own 
     products or services, if the financial institution fully 
     discloses the provision of such information and requires the 
     affiliate to maintain the confidentiality of such 
     information.'';
       (4) in subsection (d), by striking ``disclose'' and 
     inserting ``sell or otherwise disclose'';
       (5) by striking subsection (e);
       (6) by redesignating subsections (c) and (d) as subsections 
     (e) and (f), respectively; and
       (7) by inserting after subsection (b) the following:
       ``(c) Opt In for Disclosures to Nonaffiliated Third 
     Parties.--
       ``(1) Affirmative consent required.--A financial 
     institution may not sell or otherwise disclose nonpublic 
     personal information to any nonaffiliated third party, unless 
     the consumer to whom the information pertains--
       ``(A) has affirmatively consented to the sale or disclosure 
     of such information; and
       ``(B) has not withdrawn the consent.
       ``(2) Exception.--This subsection shall not prevent a 
     financial institution from providing nonpublic personal 
     information to a nonaffiliated third party to perform 
     services for or functions on behalf of the financial 
     institution, including marketing of the financial 
     institution's own products or services (subject to subsection 
     (d) with respect to joint agreements between 2 or more 
     financial institutions), if the financial institution fully 
     discloses the provision of such information and enters into a 
     contractual agreement with the nonaffiliated third party that 
     requires that third party to maintain the confidentiality of 
     such information.
       ``(d) Opt Out for Joint Agreements.--A financial 
     institution may not sell or otherwise disclose nonpublic 
     personal information to a nonaffiliated third party for the 
     purpose of offering financial products or services pursuant 
     to a joint agreement between 2 or more financial 
     institutions, unless--
       ``(1) the financial institution clearly and conspicuously 
     discloses to the consumer to whom the information pertains, 
     in writing or in electronic form or other form permitted by 
     the regulations prescribed under section 504, that such 
     information may be disclosed to such nonaffiliated third 
     party;
       ``(2) the consumer is given the opportunity, before the 
     time that such information is initially disclosed, to direct 
     that such information not be disclosed to such nonaffiliated 
     third party;
       ``(3) the consumer is given an explanation of how the 
     consumer can exercise that nondisclosure option; and
       ``(4) the financial institution receiving the nonpublic 
     personal information signs a written agreement obliging it--
       ``(A) to maintain the confidentiality of the information; 
     and
       ``(B) to refrain from using, selling, or otherwise 
     disclosing the information other than to carry out the joint 
     offering or servicing of the financial product or financial 
     service that is the subject of the written agreement.''.

     SEC. 303. EXCEPTIONS TO DISCLOSURE PROHIBITION.

       (a) In General.--Section 502 of the Gramm-Leach-Bliley Act 
     (15 U.S.C. 6802), as amended by this title, is amended by 
     adding at the end the following:
       ``(g) General Exceptions.--Notwithstanding any other 
     provision of this section, this section does not prohibit--
       ``(1) the sale or other disclosure of nonpublic personal 
     information to an affiliate or a nonaffiliated third party--
       ``(A) as necessary to effect, administer, or enforce a 
     transaction requested or authorized by the consumer to whom 
     the information pertains, or in connection with--
       ``(i) servicing or processing a financial product or 
     service requested or authorized by the consumer;
       ``(ii) maintaining or servicing the account of the consumer 
     with the financial institution, or with another entity as 
     part of a private label credit card program or other 
     extension of credit on behalf of such entity; or
       ``(iii) a proposed or actual securitization, secondary 
     market sale (including sales of servicing rights), or similar 
     transaction related to a transaction of the consumer;
       ``(B) with the consent or at the direction of the consumer, 
     in accordance with applicable rules prescribed under this 
     subtitle;
       ``(C) to the extent specifically permitted or required 
     under other provisions of law and in accordance with the 
     Right to Financial Privacy Act of 1978; or
       ``(D) to law enforcement agencies (including a Federal 
     functional regulator, the Secretary of the Treasury, with 
     respect to subchapter II of chapter 53 of title 31, United 
     States Code, and chapter 2 of title I of Public Law 91-508 
     (12 U.S.C. 1951-1959), a State insurance authority, or the 
     Federal Trade Commission), self-regulatory organizations, or 
     for an investigation on a matter related to public safety;
       ``(2) the disclosure, other than the sale, of nonpublic 
     personal information to identify or locate missing and 
     abducted children, witnesses, criminals, and fugitives, 
     parties to lawsuits, parents, delinquents in child support 
     payments, organ and bone marrow donors, pension fund 
     beneficiaries, and missing heirs; or
       ``(3) the disclosure, other than the sale, of nonpublic 
     personal information--
       ``(A) to protect the confidentiality or security of the 
     records of the financial institution pertaining to the 
     consumer, the service or product, or the transaction therein;
       ``(B) to protect against or prevent actual or potential 
     fraud, unauthorized transactions, claims, or other liability;
       ``(C) for required institutional risk control, or for 
     resolving customer disputes or inquiries;
       ``(D) to persons holding a legal or beneficial interest 
     relating to the consumer;
       ``(E) to persons acting in a fiduciary or representative 
     capacity on behalf of the consumer;
       ``(F) to provide information to insurance rate advisory 
     organizations, guaranty funds

[[Page S4567]]

     or agencies, applicable rating agencies of the financial 
     institution, persons assessing the compliance of the 
     institution with industry standards, or the attorneys, 
     accountants, or auditors of the institution;
       ``(G) to a consumer reporting agency, in accordance with 
     the Fair Credit Reporting Act or from a consumer report 
     reported by a consumer reporting agency, as those terms are 
     defined in that Act;
       ``(H) in connection with a proposed or actual sale, merger, 
     transfer, or exchange of all or a portion of a business or 
     operating unit if the disclosure of nonpublic personal 
     information concerns solely consumers of such business or 
     unit;
       ``(I) to comply with Federal, State, or local laws, rules, 
     or other applicable legal requirements, or with a properly 
     authorized civil, criminal, or regulatory investigation or 
     subpoena or summons by Federal, State, or local authorities; 
     or
       ``(J) to respond to judicial process or government 
     regulatory authorities having jurisdiction over the financial 
     institution for examination, compliance, or other purposes, 
     as authorized by law.
       ``(h) Denial of Service Prohibited.--A financial 
     institution may not deny any consumer a financial product or 
     a financial service as a result of the refusal by the 
     consumer to grant consent to disclosure under this section or 
     the exercise by the consumer of a nondisclosure option under 
     this section, except that nothing in this subsection may be 
     construed to prohibit a financial institution from offering 
     incentives to elicit consumer consent to the use of his or 
     her nonpublic personal information.''.
       (b) Repeal of Regulatory Exemption Authority.--Section 504 
     of the Gramm-Leach-Bliley Act (15 U.S.C. 6804) is amended--
       (1) by striking subsection (b);
       (2) by striking ``(a) Regulatory Authority.--'';
       (3) by redesignating paragraphs (1), (2), and (3) as 
     subsections (a), (b), and (c), respectively, and moving the 
     margins 2 ems to the left; and
       (4) by striking ``paragraph (1)'' and inserting 
     ``subsection (a)''.

     SEC. 304. CONFORMING AMENDMENTS.

       Title V of the Gramm-Leach-Bliley Act (15 U.S.C. 6801 et 
     seq.) is amended--
       (1) in section 503(b)(1) (15 U.S.C. 6803(b)(1))--
       (A) by inserting ``affiliates and'' before 
     ``nonaffiliated''; and
       (B) in subparagraph (A), by striking ``502(e)'' and 
     inserting ``502(g)''; and
       (2) in section 509(3)(D) (15 U.S.C. 6809(3)(D)), by 
     striking ``502(e)(1)(C)'' and inserting 
     ``502(g)(1)(A)(iii)''.

     SEC. 305. REGULATORY AUTHORITY.

       Not later than 6 months after the date of enactment of this 
     Act, the agencies referred to in section 504(a)(1) of the 
     Gramm-Leach-Bliley Act (15 U.S.C. 6804(a)(1)) shall 
     promulgate final regulations in accordance with that section 
     504 to carry out the amendments made by this Act.

     SEC. 306. EFFECTIVE DATE.

       This title and the amendments made by this title shall take 
     effect 6 months after the date of enactment of this Act.

 TITLE IV--LIMITATIONS ON THE PROVISION OF PROTECTED HEALTH INFORMATION

     SEC. 401. DEFINITIONS.

       In this title:
       (1) Business associate.--
       (A) In general.--Except as provided in subparagraph (B), 
     the term ``business associate'' means, with respect to a 
     covered entity, a person who--
       (i) on behalf of such covered entity or of an organized 
     health care arrangement in which the covered entity 
     participates, but other than in the capacity of a member of 
     the workforce of such covered entity or arrangement, 
     performs, or assists in the performance of--

       (I) a function or activity involving the use or disclosure 
     of individually identifiable health information, including 
     claims processing or administration, data analysis, 
     processing or administration, utilization review, quality 
     assurance, billing, benefit management, practice management, 
     and repricing; or
       (II) any other function or activity regulated under 
     subchapter C of title 45, Code of Federal Regulations; or

       (ii) provides, other than in the capacity of a member of 
     the workforce of such covered entity, legal, actuarial, 
     accounting, consulting, data aggregation (as defined in 
     section 164.501 of title 45, Code of Federal Regulations), 
     management, administrative, accreditation, or financial 
     services to or for such covered entity, or to or for an 
     organized health care arrangement in which the covered entity 
     participates, where the provision of the service involves the 
     disclosure of individually identifiable health information 
     from such covered entity or arrangement, or from another 
     business associate of such covered entity or arrangement, to 
     the person.
       (B) Limitations.--
       (i) In general.--A covered entity participating in an 
     organized health care arrangement that performs a function or 
     activity as described by subparagraph (A)(i) for or on behalf 
     of such organized health care arrangement, or that provides a 
     service as described in subparagraph (A)(ii) to or for such 
     organized health care arrangement, does not, simply through 
     the performance of such function or activity or the provision 
     of such service, become a business associate of other covered 
     entities participating in such organized health care 
     arrangement.
       (ii) Limitation.--A covered entity may be a business 
     associate of another covered entity.
       (2) Covered entity.--The term ``covered entity'' means--
       (A) a health plan;
       (B) a health care clearinghouse; and
       (C) a health care provider who transmits any health 
     information in electronic form in connection with a 
     transaction covered by parts 160 through 164 of title 45, 
     Code of Federal Regulations.
       (3) Disclosure.--The term ``disclosure'' means the release, 
     transfer, provision of access to, or divulging in any other 
     manner of information outside the entity holding the 
     information.
       (4) Employer.--The term ``employer'' has the meaning given 
     that term in section 3401(d) of the Internal Revenue Code of 
     1986.
       (5) Group health plan.--The term ``group health plan'' 
     means an employee welfare benefit plan (as defined in section 
     3(1) of the Employee Retirement Income and Security Act of 
     1974 (29 U.S.C. 1002(1)), including insured and self-insured 
     plans, to the extent that the plan provides medical care (as 
     defined in section 2791(a)(2) of the Public Health Service 
     Act, 42 U.S.C. 300gg-91(a)(2)), including items and services 
     paid for as medical care, to employees or their dependents 
     directly or through insurance, reimbursement, or otherwise, 
     that--
       (A) has 50 or more participants (as defined in section 3(7) 
     of Employee Retirement Income and Security Act of 1974, 29 
     U.S.C. 1002(7)); or
       (B) is administered by an entity other than the employer 
     that established and maintains the plan.
       (6) Health care.--The term ``health care'' includes, but is 
     not limited to, the following:
       (A) Preventive, diagnostic, therapeutic, rehabilitative, 
     maintenance, or palliative care and counseling, service, 
     assessment, or procedure with respect to the physical or 
     mental condition, or functional status, of an individual or 
     that affects the structure or function of the body.
       (B) The sale or dispensing of a drug, device, equipment, or 
     other item in accordance with a prescription.
       (7) Health care clearinghouse.--The term ``health care 
     clearinghouse'' means a public or private entity, including a 
     billing service, repricing company, community health 
     management information system or community health information 
     system, and value-added networks and switches, that--
       (A) processes or facilitates the processing of health 
     information received from another entity in a nonstandard 
     format or containing nonstandard data content into standard 
     data elements or a standard transaction; or
       (B) receives a standard transaction from another entity and 
     processes or facilitates the processing of health information 
     into nonstandard format or nonstandard data content for the 
     receiving entity.
       (8) Health care provider.--The term ``health care 
     provider'' has the meaning given the terms ``provider of 
     services'' and ``provider of medical or health services'' in 
     subsections (u) and (s) of section 1861 of the Social 
     Security Act (42 U.S.C. 1395x), respectively, and includes 
     any other person or organization who furnishes, bills, or is 
     paid for health care in the normal course of business.
       (9) Health information.--The term ``health information'' 
     means any information, whether oral or recorded in any form 
     or medium, that--
       (A) is created or received by a health care provider, 
     health plan, public health authority, employer, life insurer, 
     school or university, or health care clearinghouse; and
       (B) relates to the past, present, or future physical or 
     mental health or condition of an individual; the provision of 
     health care to an individual; or the past, present, or future 
     payment for the provision of health care to an individual.
       (10) Health insurance issuer.--The term ``health insurance 
     issuer'' means a health insurance issuer (as defined in 
     section 2791(b)(2) of the Public Health Service Act, 42 
     U.S.C. 300gg-91(b)(2)) and used in the definition of health 
     plan in this section and includes an insurance company, 
     insurance service, or insurance organization (including an 
     HMO) that is licensed to engage in the business of insurance 
     in a State and is subject to State law that regulates 
     insurance. Such term does not include a group health plan.
       (11) Health maintenance organization.--The term ``health 
     maintenance organization'' (HMO) (as defined in section 
     2791(b)(3) of the Public Health Service Act, 42 U.S.C. 300gg-
     91 (b)(3)) and used in the definition of health plan in this 
     section, means a federally qualified HMO, an organization 
     recognized as an HMO under State law, or a similar 
     organization regulated for solvency under State law in the 
     same manner and to the same extent as such an HMO.
       (12) Health oversight agency.--The term ``health oversight 
     agency'' means an agency or authority of the United States, a 
     State, a territory, a political subdivision of a State or 
     territory, or an Indian tribe, or a person or entity acting 
     under a grant of authority from or contract with such public 
     agency, including the employees or agents of such public 
     agency or its contractors or persons or entities to whom it 
     has granted authority, that is authorized by law to oversee 
     the health care system (whether public or private) or 
     government programs in which health information is necessary 
     to determine eligibility or compliance, or to enforce civil

[[Page S4568]]

     rights laws for which health information is relevant.
       (13) Health plan.--The term ``health plan'' means an 
     individual or group plan that provides, or pays the cost of, 
     medical care, as defined in section 2791(a)(2) of the Public 
     Health Service Act (42 U.S.C. 300gg-91(a)(2))--
       (A) including, singly or in combination--
       (i) a group health plan;
       (ii) a health insurance issuer;
       (iii) an HMO;
       (iv) part A or B of the medicare program under title XVIII 
     of the Social Security Act (42 U.S.C. 1395 et seq.);
       (v) the medicaid program under title XIX of the Social 
     Security Act (42 U.S.C. 1396 et seq.);
       (vi) an issuer of a medicare supplemental policy (as 
     defined in section 1882(g)(1) of the Social Security Act, 42 
     U.S.C. 1395ss(g)(1));
       (vii) an issuer of a long-term care policy, excluding a 
     nursing home fixed-indemnity policy;
       (viii) an employee welfare benefit plan or any other 
     arrangement that is established or maintained for the purpose 
     of offering or providing health benefits to the employees of 
     2 or more employers;
       (ix) the health care program for active military personnel 
     under title 10, United States Code;
       (x) the veterans health care program under chapter 17 of 
     title 38, United States Code;
       (xi) the Civilian Health and Medical Program of the 
     Uniformed Services (CHAMPUS) (as defined in section 1072(4) 
     of title 10, United States Code);
       (xii) the Indian Health Service program under the Indian 
     Health Care Improvement Act (25 U.S.C. 1601 et seq.);
       (xiii) the Federal Employees Health Benefits Program under 
     chapter 89 of title 5, United States Code;
       (xiv) an approved State child health plan under title XXI 
     of the Social Security Act (42 U.S.C. 1397aa et seq.), 
     providing benefits for child health assistance that meet the 
     requirements of section 2103 of such Act (42 U.S.C. 1397cc);
       (xv) the Medicare+Choice program under part C of title 
     XVIII of the Social Security Act (42 U.S.C. 1395w-21 et 
     seq.);
       (xvi) a high risk pool that is a mechanism established 
     under State law to provide health insurance coverage or 
     comparable coverage to eligible individuals; and
       (xvii) any other individual or group plan, or combination 
     of individual or group plans, that provides or pays for the 
     cost of medical care (as defined in section 2791(a)(2) of the 
     Public Health Service Act (42 U.S.C. 300gg-91(a)(2)); and
       (B) excluding--
       (i) any policy, plan, or program to the extent that it 
     provides, or pays for the cost of, excepted benefits that are 
     listed in section 2791(c)(1) of the Public Health Service Act 
     (42 U.S.C. 300gg-91(c)(1)); and
       (ii) a government-funded program (other than 1 listed in 
     clause (i) through (xvi) of subparagraph (A)), whose 
     principal purpose is other than providing, or paying the cost 
     of, health care, or whose principal activity is the direct 
     provision of health care to persons, or the making of grants 
     to fund the direct provision of health care to persons.
       (14) Individually identifiable health information.--The 
     term ``individually identifiable health information'' means 
     information that is a subset of health information, including 
     demographic information collected from an individual, that--
       (A) is created or received by a covered entity or employer; 
     and
       (B)(i) relates to the past, present, or future physical or 
     mental health or condition of an individual, the provision of 
     health care to an individual, or the past, present, or future 
     payment for the provision of health care to an individual; 
     and
       (ii)(I) identifies an individual; or
       (II) with respect to which there is a reasonable basis to 
     believe that the information can be used to identify an 
     individual.
       (15) Law enforcement official.--The term ``law enforcement 
     official'' means an officer or employee of any agency or 
     authority of the United States, a State, a territory, a 
     political subdivision of a State or territory, or an Indian 
     tribe, who is empowered by law to--
       (A) investigate or conduct an official inquiry into a 
     potential violation of law; or
       (B) prosecute or otherwise conduct a criminal, civil, or 
     administrative proceeding arising from an alleged violation 
     of law.
       (16) Life insurer.--The term ``life insurer'' means a life 
     insurance company (as defined in section 816 of the Internal 
     Revenue Code of 1986), including the employees and agents of 
     such company.
       (17) Marketing.--The term ``marketing'' means to make a 
     communication about a product or service that encourages 
     recipients of the communication to purchase or use the 
     product or service.
       (18) Noncovered entity.--The term ``noncovered entity'' 
     means any person or public or private entity that is not a 
     covered entity, including but not limited to a business 
     associate of a covered entity, a covered entity if such 
     covered entity is acting as a business associate, a health 
     researcher, school or university, life insurer, employer, 
     public health authority, health oversight agency, or law 
     enforcement official, or any person acting as an agent of 
     such entities or persons.
       (19) Organized health care arrangement.--The term 
     ``organized health care arrangement'' means--
       (A) a clinically integrated care setting in which 
     individuals typically receive health care from more than 1 
     health care provider;
       (B) an organized system of health care in which more than 1 
     covered entity participates, and in which the participating 
     covered entities--
       (i) hold themselves out to the public as participating in a 
     joint arrangement; and
       (ii) participate in joint activities including at least--

       (I) utilization review, in which health care decisions by 
     participating covered entities are reviewed by other 
     participating covered entities or by a third party on their 
     behalf;
       (II) quality assessment and improvement activities, in 
     which treatment provided by participating covered entities is 
     assessed by other participating covered entities or by a 
     third party on their behalf; or
       (III) payment activities, if the financial risk for 
     delivering health care is shared, in part or in whole, by 
     participating covered entities through the joint arrangement 
     and if protected health information created or received by a 
     covered entity is reviewed by other participating covered 
     entities or by a third party on their behalf for the purpose 
     of administering the sharing of financial risk;

       (C) a group health plan and a health insurance issuer or 
     HMO with respect to such group health plan, but only with 
     respect to protected health information created or received 
     by such health insurance issuer or HMO that relates to 
     individuals who are or who have been participants or 
     beneficiaries in such group health plan;
       (D) a group health plan and 1 or more other group health 
     plans each of which are maintained by the same plan sponsor; 
     or
       (E) the group health plans described in subparagraph (D) 
     and health insurance issuers or HMOs with respect to such 
     group health plans, but only with respect to protected health 
     information created or received by such health insurance 
     issuers or HMOs that relates to individuals who are or have 
     been participants or beneficiaries in any of such group 
     health plans.
       (20) Protected health information.--
       (A) In general.--The term ``protected health information'' 
     means individually identifiable health information that, 
     except as provided in subparagraph (B), is--
       (i) transmitted by electronic media;
       (ii) maintained in any medium described in the definition 
     of electronic media in section 162.103 of title 45, Code of 
     Federal Regulations; or
       (iii) transmitted or maintained in any other form or 
     medium.
       (B) Exclusions.--Such term does not include individually 
     identifiable health information in--
       (i) education records covered by the Family Educational 
     Rights and Privacy Act of 1974 (section 444 of the General 
     Education Provisions Act (20 U.S.C. 1232g));
       (ii) records described in subsection (a)(4)(B)(iv) of that 
     Act; or
       (iii) employment records held by a covered entity in its 
     role as an employer.
       (21) Public health authority.--The term ``public health 
     authority'' means an agency or authority of the United 
     States, a State, a territory, a political subdivision of a 
     State or territory, or an Indian tribe, or a person or entity 
     acting under a grant of authority from or contract with such 
     public agency, including employees or agents of such public 
     agency or its contractors or persons or entities to whom it 
     has granted authority, that is responsible for public health 
     matters as part of its official mandate.
       (22) School or university.--The term ``school or 
     university'' means an institution or place for instruction or 
     education, including an elementary school, secondary school, 
     or institution of higher learning, a college, or an 
     assemblage of colleges united under 1 corporate organization 
     or government.
       (23) Secretary.--The term ``Secretary'' means the Secretary 
     of Health and Human Services.
       (24) Sale; sell; sold.--The terms ``sale'', ``sell'', and 
     ``sold'', with respect to protected health information, mean 
     the exchange of such information for anything of value, 
     directly or indirectly, including the licensing, bartering, 
     or renting of such information.
       (25) Use.--The term ``use'' means, with respect to 
     individually identifiable health information, the sharing, 
     employment, application, utilization, examination, or 
     analysis of such information within an entity that maintains 
     such information.
       (26) Writing.--The term ``writing'' means writing in either 
     a paper-based or computer-based form, including electronic 
     and digital signatures.

     SEC. 402. PROHIBITION AGAINST SELLING PROTECTED HEALTH 
                   INFORMATION.

       (a) Valid Authorization Required.--
       (1) In General.--A noncovered entity shall not sell the 
     protected health information of an individual or use such 
     information for marketing purposes without an authorization 
     that is valid under section 403. When a noncovered entity 
     obtains or receives authorization to sell such information, 
     such sale must be consistent with such authorization.
       (2) No duplicate authorization required.--Nothing in 
     paragraph (1) shall be construed as requiring a noncovered 
     entity that receives from a covered entity an authorization 
     that is valid under section 403 to obtain a separate 
     authorization from an individual before the sale or use of 
     the individual's protected health information so long as the 
     sale or use of the information is consistent with the terms 
     of the authorization.

[[Page S4569]]

       (b) Scope.--A sale of protected health information as 
     described under subsection (a) shall be limited to the 
     minimum amount of information necessary to accomplish the 
     purpose for which the sale is made.
       (c) Purpose.--A recipient of information sold pursuant to 
     this title may use or disclose such information solely to 
     carry out the purpose for which the information was sold.
       (d) Not Required.--Nothing in this title permitting the 
     sale of protected health information shall be construed to 
     require such sale.
       (e) Identification of Information as Protected Health 
     Information.--Information sold pursuant to this title shall 
     be clearly identified as protected health information.
       (f) No Waiver.--Except as provided in this title, an 
     individual's authorization to sell protected health 
     information shall not be construed as a waiver of any rights 
     that the individual has under other Federal or State laws, 
     the rules of evidence, or common law.

     SEC. 403. AUTHORIZATION FOR SALE OR MARKETING OF PROTECTED 
                   HEALTH INFORMATION BY NONCOVERED ENTITIES.

       (a) Valid Authorization.--A valid authorization is a 
     document that complies with all requirements of this section. 
     Such authorization may include additional information not 
     required under this section, provided that such information 
     is not inconsistent with the requirements of this section.
       (b) Defective Authorization.--An authorization is not 
     valid, if the document submitted has any of the following 
     defects:
       (1) The expiration date has passed or the expiration event 
     is known by the noncovered entity to have occurred.
       (2) The authorization has not been filled out completely, 
     with respect to an element described in subsections (e) and 
     (f).
       (3) The authorization is known by the noncovered entity to 
     have been revoked.
       (4) The authorization lacks an element required by 
     subsections (e) and (f).
       (5) Any material information in the authorization is known 
     by the noncovered entity to be false.
       (c) Revocation of Authorization.--An individual may revoke 
     an authorization provided under this section at any time 
     provided that the revocation is in writing, except to the 
     extent that the noncovered entity has taken action in 
     reliance thereon.
       (d) Documentation.--
       (1) In general.--A noncovered entity must document and 
     retain any signed authorization under this section as 
     required under paragraph (2).
       (2) Standard.--A noncovered entity shall, if a 
     communication is required by this title to be in writing, 
     maintain such writing, or an electronic copy, as 
     documentation.
       (3) Retention period.--A noncovered entity shall retain the 
     documentation required by this section for 6 years from the 
     date of its creation or the date when it last was in effect, 
     whichever is later.
       (e) Content of Authorization.--
       (1) Content.--An authorization described in subsection (a) 
     shall--
       (A) contain a description of the information to be sold 
     that identifies such information in a specific and meaningful 
     manner;
       (B) contain the name or other specific identification of 
     the person, or class of persons, authorized to sell the 
     information;
       (C) contain the name or other specific identification of 
     the person, or class of persons, to whom the information is 
     to be sold;
       (D) include an expiration date or an expiration event 
     relating to the selling of such information that signifies 
     that the authorization is valid until such date or event;
       (E) include a statement that the individual has a right to 
     revoke the authorization in writing and the exceptions to the 
     right to revoke, and a description of the procedure involved 
     in such revocation;
       (F) be in writing and include the signature of the 
     individual and the date, or if the authorization is signed by 
     a personal representative of the individual, a description of 
     such representative's authority to act for the individual; 
     and
       (G) include a statement explaining the purpose for which 
     such information is sold.
       (2) Plain language.--The authorization shall be written in 
     plain language.
       (f) Notice.--
       (1) In general.--The authorization shall include a 
     statement that the individual may--
       (A) inspect or copy the protected health information to be 
     sold; and
       (B) refuse to sign the authorization.
       (2) Copy to the individual.--A noncovered entity shall 
     provide the individual with a copy of the signed 
     authorization.
       (g) Model Authorizations.--The Secretary, after notice and 
     opportunity for public comment, shall develop and disseminate 
     model written authorizations of the type described in this 
     section and model statements of the limitations on such 
     authorizations. Any authorization obtained on a model 
     authorization form developed by the Secretary pursuant to the 
     preceding sentence shall be deemed to satisfy the 
     requirements of this section.
       (h) Noncoercion.--A covered entity or noncovered entity 
     shall not condition the purchase of a product or the 
     provision of a service to an individual based on whether such 
     individual provides an authorization to such entity as 
     described in this section.

     SEC. 404. PROHIBITION AGAINST RETALIATION.

       A noncovered entity that collects protected health 
     information, may not adversely affect another person, 
     directly or indirectly, because such person has exercised a 
     right under this title, disclosed information relating to a 
     possible violation of this title, or associated with, or 
     assisted, a person in the exercise of a right under this 
     title.

     SEC. 405. RULE OF CONSTRUCTION.

       The requirements of this title shall not be construed to 
     impose any additional requirements or in any way alter the 
     requirements imposed upon covered entities under parts 160 
     through 164 of title 45, Code of Federal Regulations.

     SEC. 406. REGULATIONS.

       (a) In General.--The Secretary shall promulgate regulations 
     implementing the provisions of this title.
       (b) Timeframe.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary shall publish proposed 
     regulations in the Federal Register. With regard to such 
     proposed regulations, the Secretary shall provide an 
     opportunity for submission of comments by interested persons 
     during a period of not less than 90 days. Not later than 2 
     years after the date of enactment of this Act, the Secretary 
     shall publish final regulations in the Federal Register.

     SEC. 407. ENFORCEMENT.

       (a) In General.--A covered entity or noncovered entity that 
     knowingly violates section 402 shall be subject to a civil 
     money penalty under this section.
       (b) Amount.--The civil money penalty described in 
     subsection (a) shall not exceed $100,000. In determining the 
     amount of any penalty to be assessed, the Secretary shall 
     take into account the previous record of compliance of the 
     entity being assessed with the applicable provisions of this 
     title and the gravity of the violation.
       (c) Administrative Review.--
       (1) Opportunity for hearing.--The entity assessed shall be 
     afforded an opportunity for a hearing by the Secretary upon 
     request made within 30 days after the date of the issuance of 
     a notice of assessment. In such hearing the decision shall be 
     made on the record pursuant to section 554 of title 5, United 
     States Code. If no hearing is requested, the assessment shall 
     constitute a final and unappealable order.
       (2) Hearing procedure.--If a hearing is requested, the 
     initial agency decision shall be made by an administrative 
     law judge, and such decision shall become the final order 
     unless the Secretary modifies or vacates the decision. Notice 
     of intent to modify or vacate the decision of the 
     administrative law judge shall be issued to the parties 
     within 30 days after the date of the decision of the judge. A 
     final order which takes effect under this paragraph shall be 
     subject to review only as provided under subsection (d).
       (d) Judicial Review.--
       (1) Filing of action for review.--Any entity against whom 
     an order imposing a civil money penalty has been entered 
     after an agency hearing under this section may obtain review 
     by the United States district court for any district in which 
     such entity is located or the United States District Court 
     for the District of Columbia by filing a notice of appeal in 
     such court within 30 days from the date of such order, and 
     simultaneously sending a copy of such notice by registered 
     mail to the Secretary.
       (2) Certification of administrative record.--The Secretary 
     shall promptly certify and file in such court the record upon 
     which the penalty was imposed.
       (3) Standard for review.--The findings of the Secretary 
     shall be set aside only if found to be unsupported by 
     substantial evidence as provided by section 706(2)(E) of 
     title 5, United States Code.
       (4) Appeal.--Any final decision, order, or judgment of the 
     district court concerning such review shall be subject to 
     appeal as provided in chapter 83 of title 28 of such Code.
       (e) Failure To Pay Assessment; Maintenance of Action.--
       (1) Failure to pay assessment.--If any entity fails to pay 
     an assessment after it has become a final and unappealable 
     order, or after the court has entered final judgment in favor 
     of the Secretary, the Secretary shall refer the matter to the 
     Attorney General who shall recover the amount assessed by 
     action in the appropriate United States district court.
       (2) Nonreviewability.--In such action the validity and 
     appropriateness of the final order imposing the penalty shall 
     not be subject to review.
       (f) Payment of Penalties.--Except as otherwise provided, 
     penalties collected under this section shall be paid to the 
     Secretary (or other officer) imposing the penalty and shall 
     be available without appropriation and until expended for the 
     purpose of enforcing the provisions with respect to which the 
     penalty was imposed.

                   TITLE V--DRIVER'S LICENSE PRIVACY

     SEC. 501. DRIVER'S LICENSE PRIVACY.

       Section 2725 of title 18, United States Code, is amended by 
     striking paragraphs (2) through (4) and adding the following:
       ``(2) `person' means an individual, organization, or 
     entity, but does not include a State or agency thereof;
       ``(3) `personal information' means information that 
     identifies an individual, including an individual's 
     photograph, social security number, driver identification 
     number, name, address (but not the 5-digit zip code), 
     telephone number, medical or disability information, any 
     physical copy of a driver's license, birth date, information 
     on physical characteristics, including height, weight, sex or 
     eye color, or any biometric identifiers on

[[Page S4570]]

     a license, including a finger print, but not information on 
     vehicular accidents, driving violations, and driver's status;
       ``(4) `highly restricted personal information' means an 
     individual's photograph or image, social security number, 
     medical or disability information, any physical copy of a 
     driver's license, driver identification number, birth date, 
     information on physical characteristics, including height, 
     weight, sex, or eye color, or any biometric identifiers on a 
     license, including a finger print; and''.

                        TITLE VI--MISCELLANEOUS

     SEC. 601. ENFORCEMENT BY STATE ATTORNEYS GENERAL.

       (a) In General.--
       (1) Civil actions.--In any case in which the attorney 
     general of a State has reason to believe that an interest of 
     the residents of that State has been or is threatened or 
     adversely affected by the engagement of any person in a 
     practice that is prohibited under title I, II, or IV of this 
     Act or under any amendment made by such a title, the State, 
     as parens patriae, may bring a civil action on behalf of the 
     residents of the State in a district court of the United 
     States of appropriate jurisdiction to--
       (A) enjoin that practice;
       (B) enforce compliance with such titles or such amendments;
       (C) obtain damage, restitution, or other compensation on 
     behalf of residents of the State; or
       (D) obtain such other relief as the court may consider to 
     be appropriate.
       (2) Notice.--
       (A) In general.--Before filing an action under paragraph 
     (1), the attorney general of the State involved shall provide 
     to the Attorney General--
       (i) written notice of the action; and
       (ii) a copy of the complaint for the action.
       (B) Exemption.--
       (i) In general.--Subparagraph (A) shall not apply with 
     respect to the filing of an action by an attorney general of 
     a State under this subsection, if the State attorney general 
     determines that it is not feasible to provide the notice 
     described in such subparagraph before the filing of the 
     action.
       (ii) Notification.--In an action described in clause (i), 
     the attorney general of a State shall provide notice and a 
     copy of the complaint to the Attorney General at the same 
     time as the State attorney general files the action.
       (b) Intervention.--
       (1) In general.--On receiving notice under subsection 
     (a)(2), the Attorney General shall have the right to 
     intervene in the action that is the subject of the notice.
       (2) Effect of intervention.--If the Attorney General 
     intervenes in an action under subsection (a), the Attorney 
     General shall have the right to be heard with respect to any 
     matter that arises in that action.
       (c) Construction.--For purposes of bringing any civil 
     action under subsection (a), nothing in this Act shall be 
     construed to prevent an attorney general of a State from 
     exercising the powers conferred on such attorney general by 
     the laws of that State to--
       (1) conduct investigations;
       (2) administer oaths or affirmations; or
       (3) compel the attendance of witnesses or the production of 
     documentary and other evidence.
       (d) Actions by the Attorney General of the United States.--
     In any case in which an action is instituted by or on behalf 
     of the Attorney General for violation of a practice that is 
     prohibited under title I, II, IV, or V of this Act or under 
     any amendment made by such a title, no State may, during the 
     pendency of that action, institute an action under subsection 
     (a) against any defendant named in the complaint in that 
     action for violation of that practice.
       (e) Venue; Service of Process.--
       (1) Venue.--Any action brought under subsection (a) may be 
     brought in the district court of the United States that meets 
     applicable requirements relating to venue under section 1391 
     of title 28, United States Code.
       (2) Service of process.--In an action brought under 
     subsection (a), process may be served in any district in 
     which the defendant--
       (A) is an inhabitant; or
       (B) may be found.

     SEC. 602. FEDERAL INJUNCTIVE AUTHORITY.

       In addition to any other enforcement authority conferred 
     under this Act or under an amendment made by this Act, the 
     Federal Government shall have injunctive authority with 
     respect to any violation of any provision of title I, II, or 
     IV of this Act or of any amendment made by such a title, 
     without regard to whether a public or private entity violates 
     such provision.
                                 ______
                                 
      By Mrs. FEINSTEIN (for herself and Mr. Kyl):
  S. 746. A bill to prevent and respond to terrorism and crime at or 
through ports; to the Committee on Commerce, Science, and 
Transportation.
  Mrs. FEINSTEIN. Mr. President, I rise today to introduce the Anti-
Terrorism and Port Security Act of 2003, comprehensive legislation 
aimed at preventing and punishing a terrorist attack at or through one 
of our nation's 361 seaports. I would like to thank Senator Kyl for 
joining me in sponsoring this bill.
  Currently, our seaports are the gaping hole in our nation's defense 
against terrorism. According to the U.S. Bureau of Transportation 
Statistics, about 13 million containers, twenty-foot equivalent units, 
came into United States ports in 2002.
  However, the U.S. government inspected only about two or three 
percent of these containers--they rest were simply waved through. In 
addition, in almost every case, these inspections occurred after the 
containers arrive in the United States.
  The problem is that a single container could contain 60,000 pounds of 
explosives--10 to 15 times the amount in the Ryder truck used to blow 
up the Murrah Federal Building in Oklahoma City--and a single container 
ship can carry as many as 8,000 containers at one time.
  Containers could easily be exploited to detonate a bomb that would 
destroy a bridge, seaport, or other critical infrastructure, causing 
mass destruction and killing thousands.
  Worse, a suitcase-sized nuclear device or radiological ``dirty bomb'' 
could also be installed in a container and shipped to the United 
States. The odds are that the container would never be inspected.
  And, even if the container was inspected, it would be too late. The 
weapon would already be in the United States--most likely near a major 
population center.
  In addition, any attack on or through a seaport could have 
devastating economic consequences.
  Excluding trade with Mexico and Canada, America's ports handle 95 
percent of U.S. trade. Every year U.S. ports handle over 800 million 
tons of cargo valued at approximately $600 billion.
  The West Coast labor disruption last year cost the U.S. economy 
somewhere $1-2 billion a day--a total of $10-20 billion. A terrorist 
attack would have an ever graver impact.
  The U.S. would likely shut down all major U.S. ports, bringing 
thousands of factories to a standstill and leaving retailers with bare 
shelves within days. And this shut down will have a ripple effect 
around the globe, raising the cost exponentially.
  In its December 2002 report, the Hart-Rudman Terrorism Task Force 
discussed the implications of a possible terrorist attack at a seaport. 
Here is what they said:

       If an explosive device were loaded in a container and set 
     off in a port, it would almost automatically raise concern 
     about the integrity of the 21,000 containers that arrive in 
     U.S. ports each day and the many thousands more that arrive 
     by truck and rail across U.S. land borders. A three-to-four-
     week closure of U.S. ports would bring the global container 
     industry to its knees. Megaports such as Rotterdam and 
     Singapore would have to close their gates to prevent boxes 
     from piling up on their limited pier space. Trucks, trains, 
     and barges would be stranded outside the terminals with no 
     way to unload their boxes. Boxes bound for the United States 
     would have to be unloaded from their outbound ships. Service 
     contracts would need to be renegotiated. As the system became 
     gridlocked, so would much of global commerce.

  I am particularly concerned about such an attack because such an 
enormous proportion of U.S. foreign trade passes through my home state 
of California.
  Last year, 6.2 million imported containers--48 percent--passed 
through California, 5.7 million just through two ports alone: the Port 
of Los Angeles and the Port of Long Beach.
  That means that, if terrorists succeeded in putting a weapon of mass 
destruction into a container undetected, there is about a one in two 
chance that this weapon would arrive and/or be detonated in Southern 
California.
  And the problem is not just with containers.
  Nearly one-quarter of all of California's imported crude oil is 
offloaded in one area. A suicide attack on a tanker at an offloading 
facility in this area could leave Southern California without refined 
fuels within a few days.
  There is no doubt in my mind that terrorists are seeking to exploit 
vulnerabilities at our seaports right now.
  Indeed, the Al Qaeda training manual specifically mentions seaports 
as a point of vulnerability in our security.
  In addition, we know that Al Qaeda has already tried to attack 
American interests at and through seaports in the past. Let me mention 
some examples.
  In October 2001, Italian authorities found an Egyptian man suspected 
of

[[Page S4571]]

having ties to Al Qaeda in a container bound for Canada. He had false 
identifications, maps of airports, a computer, a satellite phone, 
cameras, and plenty of cash on hand.
  In October 2000, Al Qaeda operatives successfully carried out a 
deadly bombing attack against the U.S.S. Cole in the port of Yemen.

  In 1998, Al Qaeda bombed the American Embassies in Kenya and 
Tanzania. Evidence suggests that the explosives the terrorists used 
were shipped to them by sea. And the investigation of the embassy 
bombings concluded that Bin Laden has close financial ties to various 
shipping companies.
  We cannot afford to be complacent. Terrorists can be very patient. We 
cannot forget the successful attack on the World Trade Center on 
September 11 took place eight years after a relatively unsuccessful 
attack on the same target.
  I introduced legislation in the last Congress to offer a 
comprehensive solution to the problem of seaport vulnerability. I am 
pleased that some of its provisions we adopted in some form by recent 
regulatory changes as well as the Maritime transportation Security Act 
of 2002 and Trade Act of 2002.
  For example, one provision in my bill required shippers to provide 
manifest information to Customs at least 24 hours before departure from 
a foreign port. Soon after the bill was introduced, Customs published a 
draft regulation with the same requirement.
  This requirement is now being enforced. However, Customs is still not 
getting all relevant information from every important party involved in 
the shipping process.
  In addition, I am pleased that, especially in the last six months, 
Customs has aggressively promoted its Container Security Initiative 
(CSI). One of the core elements of this initiative involves placing 
U.S. Customs inspectors at major foreign seaports to pre-screen cargo 
containers before they were shipped to America.
  Most of the biggest ports in the world are now participating in CSI. 
However, Customs has posted relatively few inspectors overseas and I 
believe that CSI can and should be expanded further.
  The Maritime Transportation Safety Act of 2002 and Trade Act of 2002 
also included a number of security measures.
  However, in my view, many of these measures do not go nearly far 
enough, particularly in the areas of criminal penalties, pushing back 
the border, minimum port and security standards, employee 
identification cards, research and development, and so on. And even the 
strongest provisions in these bills are, in some cases, years away from 
implementation.
  The bottom line is that, while we have made some modest improvements 
in seaport security in the last year, much more remains to be done. 
And, crucially, much remains to be done right now.
  In fact, I believe that our seaports remain almost as vulnerable 
today as they were before September 11. That is why I am introducing 
the Anti-Terrorism and Port Security Act of 2003.
  This legislation builds on improvements made to our laws in the last 
year but goes much further than those changes to ensure the security of 
our seaports.
  The Anti-Terrorism and Port Security Act of 2003 does three main 
things:
  First, the bill ensure that our criminal laws apply to deter and 
punish terrorists who choose to strike against our seaports. The bill 
closes a number of loopholes in our criminal laws to ensure that 
terrorists are held accountable for any attacks. Let me provide a 
couple of examples.
  If a person blows up an airplane, he commits a crime. However, if he 
blows up a oil tanker, he does not commit a crime--unless he is doing 
it to injure the person.
  If a person distributes explosives to a non-U.S. national, he commits 
a crime. But if the same person sows mines in the San Francisco harbor, 
he does not commit a crime.
  Specifically, the bill would: Make it a crime for terrorists to 
attack a port or a cruise ship or deploy a weapon of mass destruction 
at or through a seaport. Make it a crime to put devices in U.S. waters 
that can destroy a ship or cargo or interfere with safe navigation or 
maritime commerce. Update our federal criminal piracy and privateering 
laws and increase penalties. Make it a crime to use a dangerous weapon 
or explosive to try to kill someone on board a passenger vessel. Make 
it a crime to fail to heave to (that is, to slow or stop) a vessel at 
the direction of a Coast Guard or other authorized federal law 
enforcement official seeking to board that vessel or to interfere with 
boarding by such an officer. Make it a crime to destroy an aid to 
maritime navigation, such as a buoy or shoal/breakwater light, 
maintained by the Coast Guard if this would endanger the safe 
navigation of a vessel. Make it a crime for terrorists or criminals to 
try to attack U.S. citizens or U.S. marine live by putting poisons in 
the water off shore. Require the Attorney General to issue regulations 
making it easier to determine the extent of crime and terrorism at 
seaports and improve communication between different law enforcement 
agencies involved at ports.

  Second, the bill would help improve physical security at seaports by 
beefing up standards and ensuring greater coordination. Specific 
provisions would: Designate the Captain-of-the-Port as the primary 
authority for seaport security at each port. This would enable all 
parties involved in business at a port to understand who has final say 
on all security matters. Require minimum federal security standards for 
ports. These standards include restrictions on private vehicle access, 
a prohibition on unauthorized guns and explosives, and unauthorized 
physical access to terminal areas. They would also mandate that 
terminal areas at ports have a secure perimeter, monitored or locked 
access points, sufficient lighting, and son on. Mandate that all 
Customs inspectors have personal radiation detection pagers. Require 
all port employees and contractors to have biometric smart 
identification cards. Require Captains-of-the-Port to keep sensitive 
information on the port secure and protected. Such information would 
include, but not be limited to maps, blueprints, and information on the 
Internet.
  Third, the bill would ensure that we devote our limited cargo 
inspection resources in the most efficient and effective manner. The 
bill would improve our shipment profiling system by requiring 
additional information from more relevant parties to the shipping 
process, and it would substantially improve container security. 
Specifically, it would establish a comprehensive risk profiling plan 
for the Customs Service to focus their limited inspection capabilities 
on high-risk cargo and containers. Under this plan, all relevant 
parties in the shipment process would provide electronically relevant 
and timely information to enable Customs to determine which shipments 
to inspect. Impose steep monetary sanctions for failure to comply with 
information filing requirements, including filing incorrect information 
(the current penalty is only up to a few thousand dollars). The Seaport 
Commission found that about \1/2\ of the information on ship manifests 
was inaccurate. Push U.S. security scrutiny beyond our nation's borders 
and improve our ability to monitor and inspect cargo and containers 
before they arrive near America's shores. If a weapon of mass 
destruction arrives in a U.S. port, it is too late. Require the use of 
high security seals on all containers coming into the U.S. Require that 
each container to be transported through U.S. ports receive a universal 
transaction number that could be used to track container movement from 
origin to destination. Require all empty containers destined for U.S. 
ports to be secured. Authorize pilot programs to develop high-tech 
seals and sensors, including those that would provide real-time 
evidence of container tampering to a monitor at a terminal. Require 
ports to provide space to Customs so that the agency is able to use 
non-intrusive inspection technology. In many cases, Customs has to keep 
this technology outside the port and bring it in every day, which 
prevents some of the best inspection technology (which is not portable) 
from being used. Require the Department of Homeland Security to take 
the relative number of imported containers received at each port into 
account in exercising its discretion in determining the allocation of 
funds appropriated for seaport security grants.
  I believe that the Anti-Terrorism and Port Security Act of 2003 would 
make a

[[Page S4572]]

significant contribution to protecting America from terrorist attacks 
at or through our seaports. I urge my colleagues to support the 
legislation.;
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 746

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Anti-
     Terrorism and Port Security Act of 2003''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents.

 TITLE I--DETERRING AND PUNISHING TERRORISM AND CRIME AT UNITED STATES 
                                 PORTS

Sec. 101. Destruction or interference with vessels or maritime 
              facilities.
Sec. 102. Criminal sanctions for placement of destructive devices or 
              substances in United States jurisdictional waters.
Sec. 103. Piracy and privateering.
Sec. 104. Use of a dangerous weapon or explosive on a passenger vessel.
Sec. 105. Sanctions for failure to heave to and for obstruction of 
              boarding and providing false information.
Sec. 106. Criminal sanctions for violence against maritime navigation.
Sec. 107. Criminal sanctions for malicious dumping.
Sec. 108. Attorney general to coordinate port-related crime data 
              collection.

  TITLE II--PROTECTING UNITED STATES PORTS AGAINST TERRORISM AND CRIME

                     Subtitle A--General Provision

Sec. 201. Definitions.

                     Subtitle B--Security Authority

Sec. 211. Designated security authority.

                 Subtitle C--Securing the Supply Chain

Sec. 221. Manifest requirements.
Sec. 222. Penalties for inaccurate manifest.
Sec. 223. Shipment profiling plan.
Sec. 224. Inspection of merchandise at foreign facilities.

            Subtitle D--Security of Seaports and Containers

Sec. 231. Seaport security requirements.
Sec. 232. Seaport security cards.
Sec. 233. Securing sensitive information.
Sec. 234. Container security.
Sec. 235. Office and inspection facilities.
Sec. 236. Security grants to seaports.

                        TITLE III--AUTHORIZATION

Sec. 301. Authorization of appropriations.

 TITLE I--DETERRING AND PUNISHING TERRORISM AND CRIME AT UNITED STATES 
                                 PORTS

     SEC. 101. DESTRUCTION OR INTERFERENCE WITH VESSELS OR 
                   MARITIME FACILITIES.

       (a) In General.--Title 18, United States Code, is amended 
     by inserting after chapter 65 the following:

                     ``CHAPTER 66--MARITIME VESSELS

``Sec.
``1371. Jurisdiction and scope.
``1372. Destruction of vessel or maritime facility.
``1373. Imparting or conveying false information.

     ``Sec. 1371 Jurisdiction and scope

       ``(a) In General.--There is jurisdiction under section 3231 
     over an offense under this chapter if--
       ``(1) the prohibited activity takes place within the United 
     States, or in waters or submerged lands thereunder subject to 
     the jurisdiction of the United States; or
       ``(2) the prohibited activity takes place outside the 
     United States, and--
       ``(A) an offender or a victim of the prohibited activity is 
     a citizen of the United States;
       ``(B) a citizen of the United States was on board a vessel 
     to which this chapter applies; or
       ``(C) the prohibited activity involves a vessel of the 
     United States.
       ``(b) Applicability.--Nothing in this chapter shall apply 
     to otherwise lawful activities carried out by, or at the 
     direction of, the United States Government.

     ``Sec. 1372. Destruction of vessel or maritime facility

       ``(a) Offenses.--It shall be unlawful for any person--
       ``(1) to willfully--
       ``(A) set fire to, damage, destroy, disable, or wreck any 
     vessel; or
       ``(B) place or cause to be placed a destructive device or 
     destructive substance in, upon, or in proximity to, or 
     otherwise make or cause to be made an unworkable or unusable 
     or hazardous to work or use, any vessel (as defined in 
     section 3 of title 1), or any part or other materials used or 
     intended to be used in connection with the operation of a 
     vessel; or
       ``(C) set fire to, damage, destroy, disable, or displace a 
     destructive device or destructive substance in, upon, or in 
     proximity to, any maritime facility, including any aid to 
     navigation, lock, canal, or vessel traffic service facility 
     or equipment, or interfere by force or violence with the 
     operation of such maritime facility, if such action is likely 
     to endanger the safety of any vessel in navigation;
       ``(D) set fire to, damage, destroy, disable, or place a 
     destructive device or destructive substance in, upon, or in 
     proximity to any appliance, structure, property, machine, 
     apparatus, or any facility or other material used or intended 
     to be used in connection with the operation, maintenance, 
     loading, unloading, or storage of any vessel or any passenger 
     or cargo carried on, or intended to be carried on, any 
     vessel;
       ``(E) perform an act of violence against or incapacitate an 
     individual on a vessel, if such act of violence or 
     incapacitation is likely to endanger the safety of the vessel 
     or those on board;
       ``(F) perform an act of violence against a person that 
     causes or is likely to cause serious bodily injury in, upon, 
     or in proximity to any appliance, structure, property, 
     machine, apparatus, or any facility or other material used or 
     intended to be used in connection with the operation, 
     maintenance, loading, unloading, or storage of any vessel or 
     any passenger or cargo carried or intended to be carried on 
     any vessel; or
       ``(G) communicate information, knowing the information to 
     be false and under circumstances in which such information 
     may reasonably be believed, thereby endangering the safety of 
     any vessel in navigation; or
       ``(2) to attempt or conspire to do anything prohibited 
     under paragraph (1).
       ``(b) Penalty.--Any person who--
       ``(1) violates subparagraph (A) or (B) of subsection (a)(1) 
     shall be fined in accordance with this title or imprisoned 
     for a maximum life imprisonment term, or both, and if death 
     results, shall be subject to the death penalty; and
       ``(2) violates subsection (a)(2) or subparagraph (C), (D), 
     (E), (F), or (G) of subsection (a)(1) shall be fined in 
     accordance with this title or imprisoned not more than 20 
     years, or both.
       ``(c) Additional Penalties.--Any person who is fined or 
     imprisoned in accordance with subsection (b) for an offense 
     that involved a vessel that, at the time the violation 
     occurred, carried high-level radioactive waste or spent 
     nuclear fuel shall be fined in accordance with this title or 
     imprisoned for not less than 30 years, or for life.
       ``(d) Threatened Offense.--Any person who willfully imparts 
     or conveys any threat to do an act which would violate this 
     chapter, with an apparent determination and will to carry out 
     the threat, shall be--
       ``(1) fined in accordance with this title or imprisoned not 
     more than 5 years, or both; and
       ``(2) liable for all costs incurred as a result of such 
     threat.
       ``(e) Definitions.--For purposes of this section--
       ``(1) the term `destructive device' has the meaning as such 
     term in section 921(a)(4);
       ``(2) the term `destructive substance' has the meaning as 
     such term in section 31;
       ``(3) the term `high-level radioactive waste' has the 
     meaning as such term in section 2(12) of the Nuclear Waste 
     Policy Act of 1982 (42 U.S.C. 10101(12));
       ``(4) the term `serious bodily injury' has the meaning as 
     such term in section 1365(g); and
       ``(5) the term `spent nuclear fuel' has the meaning as such 
     term in section 2(23) of the Nuclear Waste Policy Act of 1982 
     (42 U.S.C. 10101(23)).

     ``Sec. 1373. Imparting or conveying false information

       ``(a) In General.--Any person who imparts or conveys, or 
     causes to be imparted or conveyed, false information, knowing 
     the information to be false, concerning an attempt or alleged 
     attempt being made or to be made, to do any act that is an 
     offense under this chapter or chapters 2, 97, or 111, shall 
     be subject to a civil penalty of not more than $5,000, which 
     shall be recoverable in a civil action brought in the name of 
     the United States.
       ``(b) Increased Penalty.--Any person who willfully and 
     maliciously, or with reckless disregard for the safety of 
     human life, imparts or conveys, or causes to be imparted or 
     conveyed, false information, knowing the information to be 
     false, concerning an attempt or alleged attempt being made by 
     or to be made, to do any act that is an offense under this 
     chapter or chapters 2, 97, or 111, shall be fined in 
     accordance with this title or imprisoned not more than 5 
     years, or both.''.
       (b) Technical and Conforming Amendment.--The table of 
     chapters at the beginning of title 18, is amended by 
     inserting after the item relating to chapter 65 the 
     following:

``66. Maritime Vessels......................................1371''.....

     SEC. 102. CRIMINAL SANCTIONS FOR PLACEMENT OF DESTRUCTIVE 
                   DEVICES OR SUBSTANCES IN UNITED STATES 
                   JURISDICTIONAL WATERS.

       (a) In General.--Chapter 111 of title 18, United States 
     Code, is amended by inserting after section 2280 the 
     following:

     ``Sec. 2280A. Devices or substances in waters of the United 
       States likely to destroy or damage ships

       ``(a) In General.--Any person who knowingly places or 
     causes to be placed in waters subject to the jurisdiction of 
     the United States, by any means, a device or substance that 
     is likely to destroy or cause damage to a ship or its cargo, 
     or cause interference with the safe navigation of vessels or 
     interference with maritime commerce, such as by

[[Page S4573]]

     damaging or destroying marine terminals, facilities, and any 
     other maritime structure or entity used in maritime commerce, 
     with the intent of causing such destruction or damage--
       ``(1) shall be fined in accordance with this title and 
     imprisoned for any term of years or for life; and
       ``(2) if the death of any person results from conduct 
     prohibited under this section, may be punished by death.
       ``(b) Applicability.--Nothing in this section shall be 
     construed to apply to otherwise lawfully authorized and 
     conducted activities of the United States Government.''.
       (b) Technical and Conforming Amendment.--The table of 
     sections for chapter 111 of title 18, United States Code, is 
     amended by inserting after the item relating to section 2280 
     the following:

``2280A. Devices or substances in waters of the United States likely to 
              destroy or damage ships.''.

     SEC. 103. PIRACY AND PRIVATEERING.

       Chapter 81 of title 18, United States Code, is amended to 
     read as follows:

                 ``CHAPTER 81--PIRACY AND PRIVATEERING

``Sec.
``1651. Piracy.
``1652. Crimes against United States persons or property on board a 
              ship or maritime structure.
``1653. Crimes against persons on board a ship or maritime structure 
              within the territorial jurisdiction of the United States.
``1654. Crimes by United States citizens or resident aliens.
``1655. Privateering.
``1656. Theft or conversion of vessel, maritime structure, cargo, or 
              effects.
``1657. Intentional wrecking or plunder of a vessel, maritime 
              structure, cargo, or effects.
``1658. Knowing receipt of an illegally acquired vessel, maritime 
              structure, cargo, or effects.
``1659. Attempts.
``1660. Accessories.
``1661. Inapplicability to United States Government activities.

     ``Sec. 1651. Piracy

       ``Any person who commits the crime of piracy and is 
     afterwards brought into, or found in, the United States shall 
     be imprisoned for life.

     ``Sec. 1652. Crimes against United States persons or property 
       on board a ship or maritime structure

       ``Any person who commits any illegal act of violence, 
     detention, or depredation against the United States, 
     including any vessel of the United States, citizen of the 
     United States, any commercial structure owned in whole or in 
     part by a United States citizen or resident alien, or any 
     United States citizen or resident alien, or the property of 
     that citizen or resident alien, on board a ship or maritime 
     structure and is afterwards brought into or found in the 
     United States, shall be fined in accordance with this title 
     or imprisoned not more than 20 years, or both.

     ``Sec. 1653. Crimes against persons on board a ship or 
       maritime structure within the territorial jurisdiction of 
       the United States

       ``Any person who commits any illegal act of violence, 
     detention, or depredation against an individual on board a 
     ship or maritime structure, or the property of that 
     individual, in waters or submerged lands thereunder, subject 
     to the jurisdiction of the United States, shall be fined in 
     accordance with this title or imprisoned not more than 20 
     years, or both.

     ``Sec. 1654. Crimes by United States citizens or resident 
       aliens

       ``Any person, being a United States citizen or resident 
     alien, or purporting to act under the authority of the United 
     States, who commits any illegal act of violence, detention, 
     or depredation against an individual on board a ship or 
     maritime structure, or the property of that individual, shall 
     be fined in accordance with this title or imprisoned not more 
     than 20 years, or both.

     ``Sec. 1655. Privateering

       ``(a) Offense.--It shall be unlawful for any person to 
     furnish, fit out, arm, or serve in a privateer or private 
     vessel used to commit any illegal act of violence, detention, 
     or depredation against an individual, or the property of that 
     individual, or any vessel or maritime structure without the 
     express authority of the United States Government when--
       ``(1) the perpetrator of the act is a United States citizen 
     or resident alien, or purports to act under authority of the 
     United States;
       ``(2) the individual against whom the act is committed is a 
     United States citizen or resident alien or the property, 
     vessel, or maritime structure involved is owned, in whole or 
     in part, by a United States citizen or resident alien; or
       ``(3) some element of the illegal act of violence, 
     detention, or depredation is committed in waters subject to 
     the jurisdiction of the United States.
       ``(b) Penalty.--Any person who violates subsection (a) 
     shall be fined in accordance with this title or imprisoned 
     not more than 20 years, or both.

     ``Sec. 1656. Theft or conversion of vessel, maritime 
       structure, cargo, or effects

       ``(a) Offense.--It shall be unlawful for any person who is 
     a captain, officer, crewman, or passenger of a vessel or 
     maritime structure to assist in the theft or conversion of 
     such vessel or maritime structure, or its cargo or effects 
     when--
       ``(1) the perpetrator is a United States citizen or 
     resident alien, or purports to act under the authority of the 
     United States;
       ``(2) the vessel, maritime structure, cargo, or effects is 
     owned in whole or in part by a United States citizen or 
     resident alien; or
       ``(3) some element of the theft or conversion is committed 
     in waters subject to the jurisdiction of the United States.
       ``(b) Penalty.--Any person who violates subsection (a) 
     shall be fined in accordance with this title or imprisoned 
     not more than 20 years, or both.

     ``Sec. 1657. Intentional wrecking or plunder of a vessel, 
       maritime structure, cargo, or effects

       ``(a) Offense.--It shall be unlawful for any person to--
       ``(1) intentionally cause the wrecking of a vessel or 
     maritime structure by act or omission, either directly such 
     as by intentional grounding, or indirectly by modification or 
     destruction of any navigational marker or safety device;
       ``(2) intentionally plunder, steal, or destroy a vessel, 
     maritime structure, cargo, or effects when such vessel or 
     maritime structure is in distress, wrecked, lost, stranded, 
     or cast away; or
       ``(3) intentionally obstruct or interfere with the rescue 
     of a person on board a vessel or maritime structure in 
     distress, wrecked, lost, stranded, or cast away, or the legal 
     salvage of such a vessel, maritime structure, cargo, or 
     effects, when--
       ``(A) the perpetrator is a United States citizen or 
     resident alien, or purports to act under authority of the 
     United States;
       ``(B) the vessel, maritime structure, cargo, or effects is 
     owned in whole or in part by a United States citizen or 
     resident alien; or
       ``(C) some element of the theft or conversion is committed 
     in waters subject to the jurisdiction of the United States.
       ``(b) Penalty.--Any person who violates subsection (a) 
     shall be fined in accordance with this title or imprisoned 
     not more than 20 years, or both.

     ``Sec. 1658. Knowing receipt of an illegally acquired vessel, 
       maritime structure, cargo, or effects

       ``Any person who knowingly receives or acquires a vessel, 
     maritime structure, cargo, or effects converted or obtained 
     by action falling under any section of this chapter shall be 
     fined in accordance with this title or imprisoned not more 
     than 20 years, or both.

     ``Sec. 1659. Attempts

       Any person who attempts any act which, if committed, would 
     constitute an offense under this chapter shall be fined in 
     accordance with this title or imprisoned not more than 20 
     years, or both.

     ``Sec. 1660. Accessories

       ``(a) Commission of an Offense.--Any person who knowingly 
     assists any person in the commission of an act that 
     constitutes an offense under this chapter shall be fined in 
     accordance with this title or imprisoned not more than 20 
     years, or both.
       ``(b) Avoidance of Consequences.--Any person who knowingly 
     assists any person in avoiding the consequences of an act 
     that constitutes an offense under this chapter shall be fined 
     in accordance with this title or imprisoned not more than 20 
     years, or both.

     ``Sec. 1661. Inapplicability to United States Government 
       activities

       ``Nothing in this chapter shall apply to otherwise lawful 
     activities--
       ``(1) carried out by, or at the direction of, the United 
     States Government; or
       ``(2) undertaken under a letter or marque and reprisal 
     issued by the United States Government.''.

     SEC. 104. USE OF A DANGEROUS WEAPON OR EXPLOSIVE ON A 
                   PASSENGER VESSEL.

       (a) In General.--Chapter 39 of title 18, United States 
     Code, is amended by inserting after section 831 the 
     following:

     ``Sec. 832. Use of a dangerous weapon or explosive on a 
       passenger vessel

       ``(a) Offense.--It shall be unlawful for any person to 
     willfully--
       ``(1) commit an act, including the use of a dangerous 
     weapon, explosive, or incendiary device, with the intent to 
     cause death or serious bodily injury to a crew member or 
     passenger of a passenger vessel or any other person while on 
     board a passenger vessel; or
       ``(2) attempt, threaten, or conspire to do any act referred 
     to in paragraph (1).
       ``(b) Penalty.--An person who violates subsection (a) shall 
     be fined in accordance with this title or imprisoned not more 
     than 20 years, or both.
       ``(c) Aggravated Offense.--Any person who commits an 
     offense described in subsection (a) in a circumstance in 
     which--
       ``(1) the vessel was carrying a passenger at the time of 
     the offense; or
       ``(2) the offense has resulted in the death of any person;

     shall be guilty of an aggravated offense and shall be fined 
     in accordance with this title or imprisoned for any term of 
     years or for life.
       ``(d) Applicability.--This section shall apply to vessels 
     that are subject to the jurisdiction of the United States, 
     and vessels carrying passengers who are United States 
     citizens or resident aliens, wherever located.
       ``(e) Definitions.--For purposes of this section--
       ``(1) the term `dangerous weapon' has the meaning given 
     such term in section 930(g);
       ``(2) the term `explosive or incendiary device' has the 
     meaning given such term in section 232(5);

[[Page S4574]]

       ``(3) the term `passenger' has the same meaning given such 
     term in section 2101(21) of title 46;
       ``(4) the term `passenger vessel' has the same meaning 
     given such term in section 2101(22) of title 46; and
       ``(5) the term `serious bodily injury' has the meaning 
     given such term in section 1365(g).''.
       (b) Technical and Conforming Amendment.--The table of 
     sections for chapter 39 of title 18, United States Code, is 
     amended by inserting after the item relating to section 831 
     the following:

``832. Use of a dangerous weapon or explosive on a passenger vessel.''.

     SEC. 105. SANCTIONS FOR FAILURE TO HEAVE TO AND FOR 
                   OBSTRUCTION OF BOARDING AND PROVIDING FALSE 
                   INFORMATION.

       (a) In General.--Chapter 109 of title 18, United States 
     Code, is amended by adding at the end the following:

     ``Sec. 2237. Sanctions for failure to heave to; sanctions for 
       obstruction of boarding or providing false information

       ``(a) Failure to Heave To.--It shall be unlawful for the 
     master, operator, or person in charge of a vessel of the 
     United States, or a vessel subject to the jurisdiction of the 
     United States, to knowingly fail to obey an order to heave to 
     on being ordered to do so by an authorized Federal law 
     enforcement officer.
       ``(b) Obstruction of Boarding and Providing False 
     Information.--It shall be unlawful for any person on board a 
     vessel of the United States or a vessel subject to the 
     jurisdiction of the United States to--
       ``(1) forcibly assault, resist, oppose, prevent, impede, 
     intimidate, or interfere with a boarding or other law 
     enforcement action authorized by any Federal law, or to 
     resist a lawful arrest; or
       ``(2) provide information to a Federal law enforcement 
     officer during a boarding of a vessel regarding the vessel's 
     destination, origin, ownership, registration, nationality, 
     cargo, or crew that the person knows is false.
       ``(c) Limitations.--This section shall not limit the 
     authority of--
       ``(1) an officer under section 581 of the Tariff Act of 
     1930 (19 U.S.C. 1581) or any other provision of law enforced 
     or administered by the Secretary of the Treasury or the Under 
     Secretary for Border and Transportation Security of the 
     Department of Homeland Security; or
       ``(2) a Federal law enforcement officer under any law of 
     the United States to order a vessel to stop or heave to.
       ``(d) Consent or Objection to Enforcement.--A foreign 
     nation may consent or waive objection to the enforcement of 
     United States law by the United States under this section by 
     radio, telephone, or similar oral or electronic means, which 
     consent or waiver may be proven by certification of the 
     Secretary of State or the Secretary's designee.
       ``(e) Penalty.--Any person who intentionally violates this 
     section shall be fined in accordance with this title and 
     imprisoned not more than 1 year.
       ``(f) Definitions.--For purposes of this section--
       ``(1) the terms `vessel of the United States' and `vessel 
     subject to the jurisdiction of the United States' have the 
     same meanings as such terms in section 3 of the Maritime Drug 
     Law Enforcement Act (46 U.S.C. App. 1903);
       ``(2) the term `heave to' means to cause a vessel to slow, 
     come to a stop, or adjust its course or speed to account for 
     the weather conditions and sea state to facilitate a law 
     enforcement boarding; and
       ``(3) the term `Federal law enforcement officer' has the 
     same meaning as such term in section 115.''.
       (b) Technical and Conforming Amendment.--The table of 
     sections for chapter 109 of title 18, United States Code, is 
     amended by adding at the end the following:

``2237. Sanctions for failure to heave to; sanctions for obstruction of 
              boarding or providing false information.''.

     SEC. 106. CRIMINAL SANCTIONS FOR VIOLENCE AGAINST MARITIME 
                   NAVIGATION.

       Section 2280(a) of title 18, United States Code, is 
     amended--
       (1) in paragraph (1)--
       (A) by redesignating subparagraphs (F), (G), and (H) as 
     (G), (H), and (I), respectively;
       (B) by inserting after subparagraph (E) the following:
       ``(F) destroys, damages, alters, moves, or tampers with any 
     aid to maritime navigation maintained by the Saint Lawrence 
     Seaway Development Corporation under the authority of section 
     4 of the Act of May 13, 1954, (33 U.S.C. 984) or the Coast 
     Guard pursuant to section 81 of title 14, or lawfully 
     maintained by the Coast Guard pursuant to section 83 of title 
     14, if such act endangers or is likely to endanger the safe 
     navigation of a ship;''; and
       (C) in subparagraph (I), as so redesignated, by striking 
     ``through (G)'' and inserting ``through (H)''; and
       (2) in paragraph (2), by striking ``(C) or (E)'' and 
     inserting ``(C), (E), or (F)''.

     SEC. 107. CRIMINAL SANCTIONS FOR MALICIOUS DUMPING.

       (a) In General.--Chapter 111 of title 18, United States 
     Code, is amended by adding at the end the following:

     ``Sec. 2282. Knowing discharge or release

       ``(a) Endangerment of Human Life.--Any person who knowingly 
     discharges or releases oil, a hazardous material, a noxious 
     liquid substance, or any other substance into the navigable 
     waters of the United States or the adjoining shoreline with 
     the intent to endanger human life, health, or welfare--
       ``(1) shall be fined in accordance with this title and 
     imprisoned for any term of years or for life; and
       ``(2) if the death of any person results from conduct 
     prohibited under this section, may be punished by death.
       ``(b) Endangerment of Marine Environment.--Any person who 
     knowingly discharges or releases oil, a hazardous material, a 
     noxious liquid substance, or any other substance into the 
     navigable waters of the United States or the adjacent 
     shoreline with the intent to endanger the marine environment 
     shall be fined in accordance with this title or imprisoned 
     not more than 30 years, or both.
       ``(c) Definitions.--For purposes of this section--
       ``(1) the term `discharge' means any spilling, leaking, 
     pumping, pouring, emitting, emptying, or dumping;
       ``(2) the term `hazardous material' has the same meaning 
     given such term in section 2101(14) of title 46;
       ``(3) the term `marine environment' has the same meaning 
     given such term in section 2101(15) of title 46;
       ``(4) the term `navigable waters' has the same meaning 
     given such term in section 502(7) of the Federal Water 
     Pollution Control Act (33 U.S.C. 1362(7)), and also includes 
     the territorial sea of the United States as described in 
     Presidential Proclamation 5928 of December 27, 1988; and
       ``(5) the term `noxious liquid substance' has the same 
     meaning given such term in the MARPOL Protocol as defined in 
     section 2(a)(3) of the Act to Prevent Pollution from Ships 
     (33 U.S.C. 1901(a)(3)).''.
       (b) Technical and Conforming Amendment.--The table of 
     sections for chapter 111 of title 18, United States Code, is 
     amended by adding at the end the following:

``2282. Knowing discharge or release.''.

     SEC. 108. ATTORNEY GENERAL TO COORDINATE PORT-RELATED CRIME 
                   DATA COLLECTION.

       (a) Regulations.--The Attorney General shall issue 
     regulations to--
       (1) require the reporting by a carrier that is the victim 
     of a cargo theft offense to the Attorney General of 
     information on the cargo theft offense (including offenses 
     occurring outside ports of entry and ports of shipment 
     origination) that identifies the port of entry, the port 
     where the shipment originated, where the theft occurred, and 
     any other information specified by the Attorney General;
       (2) create a database to contain the reports described in 
     paragraph (1) and integrate those reports, to the extent 
     feasible, with other noncriminal justice and intelligence 
     data, such as insurer bill of lading, cargo contents and 
     value, point of origin, and lien holder filings; and
       (3) prescribe procedures for access to the database created 
     in accordance with paragraph (2) by appropriate Federal, 
     State, and local governmental agencies and private companies 
     or organizations, while limiting access to privacy of the 
     information in accordance with other applicable Federal laws.
       (b) Modification of Databases.--
       (1) In general.--United States Government agencies with 
     significant regulatory or law enforcement responsibilities at 
     United States ports shall, to the extent feasible, modify 
     their information databases to ensure the collection and 
     retrievability of data relating to crime, terrorism, and 
     related activities at, or affecting, United States ports.
       (2) Designation of agencies.--The Attorney General, after 
     consultation with the Secretary of Homeland Security, shall 
     designate the agencies referred to in paragraph (1).
       (c) Outreach Program.--The Attorney General, in 
     consultation with the Secretary of Homeland Security, the 
     National Maritime Security Advisory Committee established 
     under section 70112 of title 46, United States Code, and the 
     appropriate Federal and State agencies, shall establish an 
     outreach program--
       (1) to work with State and local law enforcement officials 
     to harmonize the reporting of data on cargo theft among 
     States and localities with the United States Government's 
     reports; and
       (2) to work with local port security committees to 
     disseminate cargo theft information to appropriate law 
     enforcement officials.
       (d) Annual Report.--The Attorney General shall report 
     annually to the Committee on the Judiciary of the Senate and 
     the House of Representatives on the implementation of this 
     section.
       (e) Interstate or Foreign Shipments by Carrier; State 
     Prosecutions.--
       (1) State prosecutions.--Section 659 of title 18, United 
     States Code, is amended--
       (A) in the first undesignated paragraph--
       (i) by striking ``Whoever embezzles'' and inserting the 
     following:
       ``(a) Offense; Penalty.--Whoever--
       ``(1) embezzles'';
       (ii) by striking ``from any pipeline system'' and all that 
     follows through ``with intent to convert to his own use''; 
     and
       (iii) by striking ``or'' at the end;
       (B) in the second undesignated paragraph--
       (i) by striking ``Whoever buys'' and inserting the 
     following:
       ``(2) buys''; and
       (ii) by striking ``or'' at the end;
       (C) in the third undesignated paragraph--
       (i) by striking ``Whoever embezzles'' and inserting the 
     following''

[[Page S4575]]

       ``(3) embezzles''; and
       (ii) by striking ``with intent to convert to his own use'';
       (D) in the fourth undesignated paragraph, by striking 
     ``Whoever embezzles'' and inserting the following:
       ``(4) embezzles'';
       (E) in the fifth undesignated paragraph, by striking 
     ``Shall in each case'' and inserting the following:

     ``shall in each case'';
       (F) in the sixth undesignated paragraph, by striking 
     ``The'' and inserting the following:
       ``(b) Location of Offense.--The'';
       (G) in the seventh undesignated paragraph, by striking 
     ``The'' and inserting the following''
       ``(c) Separate Offense.--The'';
       (H) in the eighth undesignated paragraph, by striking 
     ``To'' and inserting the following:
       ``(d) Prima Facie Evidence.--To'';
       (I) in the ninth undesignated paragraph, by striking ``A'' 
     and inserting the following:
       ``(e) Prosecution.--A''; and
       (J) by adding at the end the following:
       ``(f) Civil Penalty.--
       ``(1) In general.--Notwithstanding any other provision of 
     law, and in addition to any penalties that may be available 
     under any other provision of law, a person who is found by 
     the Secretary of Homeland Security, after notice and an 
     opportunity for a hearing, to have violated this section or a 
     regulation issued under this section shall be liable to the 
     United States for a civil penalty not to exceed $25,000 for 
     each violation.
       ``(2) Separate violations.--Each day of a continuing 
     violation shall constitute a separate violation.
       ``(3) Amount of penalty.--
       ``(A) In general.--The amount of a civil penalty for a 
     violation of this section or a regulation issued under this 
     section shall be assessed by the Attorney General, or the 
     designee of the Attorney General, by written notice.
       ``(B) Considerations.--In determining the amount of a civil 
     penalty under this paragraph, the Attorney General shall take 
     into account--
       ``(i) the nature, circumstances, extent, and gravity of the 
     prohibited act committed; and
       ``(ii) with respect to the violator, the degree of 
     culpability, any history of prior offenses, ability to pay, 
     and such other matters as justice may require.
       ``(4) Modification of penalty.--The Secretary of Homeland 
     Security may compromise, modify, or remit, with or without 
     conditions, any civil penalty that is subject to imposition 
     or which has been imposed under this section.
       ``(5) Failure to pay.--If a person fails to pay an 
     assessment of a civil penalty after it has become final, the 
     Secretary of Homeland Security may refer the matter to the 
     Attorney General for collection in an appropriate district 
     court of the United States.
       ``(g) Definition.--For purposes of this section, the term 
     `goods or chattels' means to be moving as an interstate or 
     foreign shipment at all points between the point of origin 
     and the final destination (as evidenced by the waybill or 
     other shipping document of the shipment) regardless of any 
     temporary stop while awaiting transshipment or otherwise.''.
       (2) Federal sentencing guidelines.--Pursuant to section 994 
     of title 28, United States Code, the United States Sentencing 
     Commission shall review the Federal Sentencing Guidelines to 
     determine whether sentencing enhancement is appropriate for 
     any offense under section 659 of title 18, United States 
     Code, as amended by this subsection.
       (3) Annual report.--The Attorney General shall annually 
     submit to Congress a report that shall include an evaluation 
     of law enforcement activities relating to the investigation 
     and prosecution of offenses under section 659 of title 18, 
     United States Code.

  TITLE II--PROTECTING UNITED STATES PORTS AGAINST TERRORISM AND CRIME

                     Subtitle A--General Provision

     SEC. 201. DEFINITIONS.

       In this title:
       (1) Aircraft.--The term ``aircraft'' has the meaning given 
     that term in section 40102 of title 49, United States Code.
       (2) Captain-of-the-port.--The term ``Captain-of-the-Port'', 
     with respect to a United States seaport, means the individual 
     designated by the Commandant of the Coast Guard as the 
     Captain-of-the-Port at that seaport.
       (3) Common carrier.--The term ``common carrier'' means any 
     person that holds itself out to the general public as a 
     provider for hire of a transportation by water, land, or air 
     of merchandise, whether or not the person actually operates 
     the vessel, vehicle, or aircraft by which the transportation 
     is provided, between a port or place and a port or place in 
     the United States.
       (4) Container.--The term ``container'' means a container 
     that is used or designed for use for the international 
     transportation of merchandise by vessel, vehicle, or 
     aircraft.
       (5) Directorate.--The term ``Directorate'' means the Border 
     and Transportation Security Directorate of the Department of 
     Homeland Security.
       (6) Manufacturer.--The term ``manufacturer'' means a person 
     who fabricates or assembles merchandise for sale in commerce.
       (7) Merchandise.--The term ``merchandise'' has the meaning 
     given that term in section 401 of the Tariff Act of 1930 (19 
     U.S.C. 1401).
       (8) Ocean transportation intermediary.--The term ``ocean 
     transportation intermediary'' has the meaning given that term 
     in section 515.2 of title 46, Code of Federal Regulations (as 
     in effect on January 1, 2003).
       (9) Shipment.--The term ``shipment'' means cargo traveling 
     in international commerce under a bill of lading.
       (10) Shipper.--The term ``shipper'' means--
       (A) a cargo owner;
       (B) the person for whose account ocean transportation is 
     provided;
       (C) the person to whom delivery of merchandise is to be 
     made; or
       (D) a common carrier that accepts responsibility for 
     payment of all charges applicable under a tariff or service 
     contract.
       (11) United states seaport.--The term ``United States 
     seaport'' means a place in the United States on a waterway 
     with shoreside facilities for the intermodal transfer of 
     cargo containers that are used in international trade.
       (12) Vehicle.--The term ``vehicle'' has the meaning given 
     that term in section 401 of the Tariff Act of 1930 (19 U.S.C. 
     1401).
       (13) Vessel.--The term ``vessel'' has the meaning given 
     that term in section 401 of the Tariff Act of 1930 (19 U.S.C. 
     1401).

                     Subtitle B--Security Authority

     SEC. 211. DESIGNATED SECURITY AUTHORITY.

       The Captain-of-the-Port of each United States seaport shall 
     be the primary authority responsible for security at the 
     United States seaport and shall--
       (1) coordinate security at such seaport; and
       (2) be the point of contact on seaport security issues for 
     civilian and commercial port entities at such seaport.

                 Subtitle C--Securing the Supply Chain

     SEC. 221. MANIFEST REQUIREMENTS.

       Section 431(b) of the Tariff Act of 1930 (19 U.S.C. 
     1431(b)) is amended--
       (1) by striking ``Any manifest'' and inserting the 
     following:
       ``(1) In general.--Any manifest''; and
       (2) by adding at the end the following new paragraph:
       ``(2) Required information.--
       ``(A) Requirement.--In addition to any other requirement 
     under this section, the pilot, master, operator, or owner (or 
     the authorized agent of such operator or owner) of every 
     vessel required to make entry or obtain clearance under the 
     laws of the United States shall transmit electronically the 
     cargo manifest information described in subparagraph (B) in 
     such manner and form as the Secretary shall prescribe. The 
     Secretary shall ensure the electronic information is 
     maintained securely, and is available only to individuals 
     with Federal Government security responsibilities.
       ``(B) Content.--The cargo manifest required by subparagraph 
     (A) shall consist of the following information:
       ``(i) The port of arrival and departure.
       ``(ii) The carrier code assigned to the shipper.
       ``(iii) The flight, voyage, or trip number.
       ``(iv) The dates of scheduled arrival and departure.
       ``(v) A request for a permit to proceed to the destination, 
     if such permit is required.
       ``(vi) The numbers and quantities from the carrier's master 
     airway bill, bills of lading, or ocean bills of lading.
       ``(vii) The first port of lading of the cargo and the city 
     in which the carrier took receipt of the cargo.
       ``(viii) A description and weight of the cargo (including 
     the Harmonized Tariff Schedule of the United States number 
     under which the cargo is classified) or, for a sealed 
     container, the shipper's declared description and weight of 
     the cargo.
       ``(ix) The shipper's name and address, or an identification 
     number, from all airway bills and bills of lading.
       ``(x) The consignee's name and address, or an 
     identification number, from all airway bills and bills of 
     lading.
       ``(xi) Notice of any discrepancy between actual boarded 
     quantities and airway bill or bill of lading quantities, 
     except that a carrier is not required by this clause to 
     verify boarded quantities of cargo in sealed containers.
       ``(xii) Transfer or transit information for the cargo while 
     it has been under the control of the carrier.
       ``(xiii) The location of the warehouse or other facility 
     where the cargo was stored while under the control of the 
     carrier.
       ``(xiv) The name and address, or identification number of 
     the carrier's customer including the forwarder, nonvessel 
     operating common carrier, and consolidator.
       ``(xv) The conveyance name, national flag, and tail number, 
     vessel number, or train number.
       ``(xvi) The country of origin and ultimate destination.
       ``(xvii) The carrier's reference number, including the 
     booking or bill number.
       ``(xviii) The shipper's commercial invoice number and 
     purchase order number.
       ``(xix) Information regarding any hazardous material 
     contained in the cargo.
       ``(xx) License information including the license code, 
     license number, or exemption code.
       ``(xxi) The container number for containerized shipments.
       ``(xxii) Certification of the empty condition of any empty 
     containers.
       ``(xxiii) Any additional information that the Secretary, in 
     consultation with the Secretary of Homeland Security, by 
     regulation determines is reasonably necessary to ensure

[[Page S4576]]

     aviation, maritime, and surface transportation safety 
     pursuant to the laws enforced and administered by the 
     Secretary or the Under Secretary for Border and 
     Transportation Security of the Department of Homeland 
     Security.''.

     SEC. 222. PENALTIES FOR INACCURATE MANIFEST.

       (a) Falsity or Lack of Manifest.--Section 584 of the Tariff 
     Act of 1930 (19 U.S.C. 1584) is amended--
       (1) in subsection (a)(1)--
       (A) by striking ``$1,000'' each place it appears and 
     inserting ``$50,000''; and
       (B) by striking ``$10,000'' and inserting ``$50,000''; and
       (2) by adding at the end the following new subsection:
       ``(c) Criminal Penalties.--Any person who ships or prepares 
     for shipment any merchandise bound for the United States who 
     intentionally provides inaccurate or false information, 
     whether inside or outside the United States, with respect to 
     such merchandise for the purpose of introducing such 
     merchandise into the United States in violation of the laws 
     of the United States, shall be liable, upon conviction of a 
     violation of this subsection, for a fine of not more than 
     $50,000 or imprisonment for 1 year, or both; except that if 
     the importation of such merchandise into the United States is 
     prohibited, such person shall be liable for an additional 
     fine of not more than $50,000 or imprisonment for not more 
     than 5 years, or both.''.
       (b) Penalties for Violations of the Arrival, Reporting, 
     Entry, and Clearance Requirements.--Subsections (b) and (c) 
     of section 436 of Tariff Act of 1930 (19 U.S.C. 1436) are 
     amended to read as follows:
       ``(b) Civil Penalty.--Any master, person in charge of a 
     vessel, vehicle, or aircraft pilot who commits any violation 
     listed in subsection (a) shall be liable for a civil penalty 
     of $25,000 for the first violation, and $50,000 for each 
     subsequent violation, and any conveyance used in connection 
     with any such violation is subject to seizure and forfeiture.
       ``(c) Criminal Penalty.--In addition to being liable for a 
     civil penalty under subsection (b), any master, person in 
     charge of a vessel, vehicle, or aircraft pilot who 
     intentionally commits or causes another to commit any 
     violation listed in subsection (a) shall be liable, upon 
     conviction, for a fine of not more than $50,000 or 
     imprisonment for 1 year, or both; except that if the 
     conveyance has, or is discovered to have had, on board any 
     merchandise (other than sea stores or the equivalent for 
     conveyances other than vessels) the importation of which into 
     the United States is prohibited, such individual shall be 
     liable for an additional fine of not more than $50,000 or 
     imprisonment for not more than 5 years, or both.''.

     SEC. 223. SHIPMENT PROFILING PLAN.

       (a) In General.--The Secretary of Homeland Security shall 
     develop a shipment profiling plan to track containers and 
     shipments of merchandise to be imported into the United 
     States. The tracking system shall be designed to identify any 
     shipment that is a threat to the security of the United 
     States before such shipment enters the United States.
       (b) Information Requirements.--
       (1) Content.--The shipment profiling plan required by 
     subsection (a) shall at a minimum--
       (A) require common carriers, shippers, and ocean 
     transportation intermediaries to provide appropriate 
     information regarding each shipment of merchandise, including 
     the information required under section 431(b) of the Tariff 
     Act of 1930 (19 U.S.C. 1431(b)) to the Secretary of Homeland 
     Security; and
       (B) require shippers to use a standard international bill 
     of lading for each shipment that includes--
       (i) the weight of the cargo;
       (ii) the value of the cargo;
       (iii) the vessel name;
       (iv) the voyage number;
       (v) a description of each container;
       (vi) a description of the nature, type, and contents of the 
     shipment;
       (vii) the code number from the Harmonized Tariff Schedule;
       (viii) the port of destination;
       (ix) the final destination of the cargo;
       (x) the means of conveyance of the cargo;
       (xi) the origin of the cargo;
       (xii) the name of the precarriage deliverer or agent;
       (xiii) the port at which the cargo was loaded;
       (xiv) the name of the formatting agent;
       (xv) the bill of lading number;
       (xvi) the name of the shipper;
       (xvii) the name of the consignee;
       (xviii) the universal transaction number or carrier code 
     assigned to the shipper by the Secretary;
       (xix) the information contained in the continuous synopsis 
     record for the vessel transporting the shipment; and
       (xx) any additional information that the Secretary by 
     regulation determines is reasonably necessary to ensure 
     seaport safety.
       (2) Continuous synopsis record defined.--In this 
     subsection, the term ``continuous synopsis record'' means the 
     continuous synopsis record required by regulation 5 of 
     chapter XI-1 of the Annex to the International Convention of 
     the Safety of Life at Sea, 1974.
       (3) Effective date.--The requirement imposed under clause 
     (xix) of paragraph (1)(B) shall take effect on July 1, 2004.
       (c) Creation of Profile.--The Secretary of Homeland 
     Security shall combine the information described in 
     subsection (b) with other law enforcement and national 
     security information that the Secretary determines useful to 
     assist in locating containers and shipments that could pose a 
     threat to the security of the United States and to create a 
     profile of every container and every shipment within the 
     container that will enter the United States.
       (d) Cargo Screening.--
       (1) In general.--Officers of the Directorate shall review 
     the profile of a shipment that a shipper desires to transport 
     into the United States to determine whether the shipment or 
     the container in which it is carried should be subjected to 
     additional inspection by the Directorate. In making such a 
     determination, an officer shall consider, in addition to any 
     other relevant factors--
       (A) whether the shipper has regularly shipped cargo to the 
     United States in the past; and
       (B) the specificity of the description of the shipment's 
     contents.
       (2) Notification.--The Secretary of Homeland Security shall 
     transmit to the shipper and the person in charge of the 
     vessel, aircraft, or vehicle on which a shipment is located a 
     notification of whether the shipment is to be subjected to 
     additional inspection as described in paragraph (1).
       (e) Consistency With the National Customs Automation 
     Program.--The Secretary of Homeland Security, in consultation 
     with the Secretary of the Treasury, shall ensure that the 
     National Customs Automation Program established pursuant to 
     section 411 of the Tariff Act of 1930 (19 U.S.C. 1411) is 
     compatible with the shipment profile plan developed under 
     this section.

     SEC. 224. INSPECTION OF MERCHANDISE AT FOREIGN FACILITIES.

       Not later than 180 days after the date of enactment of this 
     Act, the Secretary of Homeland Security shall submit to 
     Congress a plan to--
       (1) station inspectors from the Directorate, other Federal 
     agencies, or the private sector at the foreign facilities of 
     manufacturers or common carriers to profile and inspect 
     merchandise and the containers or other means by which such 
     merchandise is transported as they are prepared for shipment 
     on a vessel that will arrive at any port or place in the 
     United States;
       (2) develop procedures to ensure the security of 
     merchandise inspected as described in paragraph (1) until it 
     reaches the United States; and
       (3) permit merchandise inspected as described in paragraph 
     (1) to receive expedited inspection upon arrival in the 
     United States.

            Subtitle D--Security of Seaports and Containers

     SEC. 231. SEAPORT SECURITY REQUIREMENTS.

       (a) Requirement.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary of Homeland Security 
     shall issue final regulations setting forth minimum security 
     requirements, including security performance standards for 
     United States seaports. The regulations shall--
       (1) limit private vehicle access to the terminal area of a 
     United States seaport to vehicles that are registered at such 
     seaport and display a seaport registration pass;
       (2) prohibit individuals, other than law enforcement 
     officers, from carrying firearms or explosives inside a 
     United States seaport without written authorization from the 
     Captain-of-the-Port;
       (3) prohibit individuals from physically accessing the 
     terminal area of a United States seaport without a seaport 
     specific access pass;
       (4) require that officers of the Directorate, and other 
     appropriate law enforcement officers, at United States 
     seaports be provided with, and utilize, personal radiation 
     detection pagers to increase the ability of such officers to 
     accurately detect radioactive materials that could be used to 
     commit terrorist acts in the United States;
       (5) require that the terminal area of each United States 
     seaport be equipped with--
       (A) a secure perimeter;
       (B) monitored or locked access points; and
       (C) sufficient lighting; and
       (6) include any additional security requirement that the 
     Secretary determines is reasonably necessary to ensure 
     seaport security.
       (b) Limitation.--Except as provided in subsection (c), any 
     United States seaport that does not meet the minimum security 
     requirements described in subsection (a) is prohibited from--
       (1) handling, storing, stowing, loading, discharging, or 
     transporting dangerous cargo; and
       (2) transferring passengers to or from a passenger vessel 
     that--
       (A) weighs more than 100 gross tons;
       (B) carries more than 12 passengers for hire; and
       (C) has a planned voyage of more than 24 hours, part of 
     which is on the high seas.
       (c) Exception.--The Secretary of Homeland Security may 
     waive 1 or more of the minimum requirements described in 
     subsection (a) for a United States seaport if the Secretary 
     determines that it is not appropriate for such seaport to 
     implement the requirement.

     SEC. 232. SEAPORT SECURITY CARDS.

       Section 70105 of title 46, United States Code, is amended--
       (1) by striking subsection (a) and inserting the following:

[[Page S4577]]

       ``(a) Prohibition.--(1) Unless the requirements of 
     paragraph (2) are met, the Secretary shall prescribe 
     regulations to prohibit--
       ``(A) an individual from entering an area of a vessel or 
     facility that is designated as a secure area by the Secretary 
     for purposes of a security plan for the vessel or facility 
     that is approved by the Secretary under section 70103 of this 
     title; and
       ``(B) an individual who is regularly employed at a United 
     States seaport or who is employed by a common carrier that 
     transports merchandise to or from a United States seaport 
     from entering a United States seaport.
       ``(2) The prohibition imposed under paragraph (1) may not 
     apply to--
       ``(A) an individual who--
       ``(i) holds a transportation security card issued under 
     this section; and
       ``(ii) is authorized to be in area in accordance with the 
     plan if the individual is attempting to enter an area of a 
     vessel or facility that is designated as a secure area by the 
     Secretary for purposes of a security plan for the vessel or 
     facility approved by the Secretary under section 70103 of 
     this title; or
       ``(B) an individual who is accompanied by another 
     individual who may access the secure area or United States 
     seaport in accordance with this section.
       ``(3) A person may not admit an individual into a United 
     States seaport or a secure area unless the individual is in 
     compliance with this subsection.'';
       (2) in paragraph (2) of subsection (b)--
       (A) in subparagraph (E), by striking ``and'';
       (B) by redesignating subparagraph (F) as subparagraph (G); 
     and
       (C) by inserting after subparagraph (E) the following new 
     subparagraph:
       ``(F) an individual who is regularly employed at a United 
     States seaport or who is employed by a common carrier that 
     transports merchandise to or from a United States seaport; 
     and'';
       (3) in paragraph (1) of subsection (c)--
       (A) in subparagraph (C), by striking ``or'';
       (B) in subparagraph (D), by striking the period at the end 
     and inserting a semicolon and ``or''; and
       (C) at the end, by inserting the following new 
     subparagraph:
       ``(E) has not provided sufficient information to allow the 
     Secretary to make the determinations described in 
     subparagraph (A), (B), (C), or (D).'';
       (4) by striking subsection (f); and
       (5) by inserting after subsection (e) the following new 
     subsections:
       ``(f) Data on Cards.--A transportation security card issued 
     under this section shall--
       ``(1) be tamper resistant; and
       ``(2) contain--
       ``(A) the number of the individual's commercial driver's 
     license issued under chapter 313 of title 49, if any;
       ``(B) the State-issued vehicle registration number of any 
     vehicle that the individual desires to bring into the United 
     States seaport, if any;
       ``(C) the work permit number issued to the individual, if 
     any;
       ``(D) a unique biometric identifier to identify the license 
     holder; and
       ``(E) a safety rating assigned to the individual by the 
     Secretary of Homeland Security.
       ``(g) Definitions.--In this section:
       ``(1) Alien.--The term `alien' has the meaning given the 
     term in section 101(a)(3) of the Immigration and Nationality 
     Act (8 U.S.C. 1101(a)(3)).
       ``(2) United states seaport.--The term `United States 
     seaport' means a place in the United States on a waterway 
     with shoreside facilities for the intermodal transfer of 
     cargo containers that are used in international trade.''.

     SEC. 233. SECURING SENSITIVE INFORMATION.

       (a) Requirement.--Not later than 90 days after the date of 
     enactment of this Act, the Captain-of-the-Port of each United 
     States seaport shall secure and protect all sensitive 
     information, including information that is currently 
     available to the public, related to the seaport.
       (b) Sensitive Information.--In this section, the term 
     ``sensitive information'' means--
       (1) maps of the seaport;
       (2) blueprints of structures located within the seaport; 
     and
       (3) any other information related to the security of the 
     seaport that the Captain-of-the-Port determines is 
     appropriate to secure and protect.

     SEC. 234. CONTAINER SECURITY.

       (a) Container Seals.--
       (1) Approval.--Not later than 90 days after the date of 
     enactment of this Act, the Secretary of Homeland Security 
     shall approve minimum standards for high security container 
     seals that--
       (A) meet or exceed the American Society for Testing 
     Materials Level D seals;
       (B) permit each seal to have a unique identification 
     number; and
       (C) contain an electronic tag that can be read 
     electronically at a seaport.
       (2) Requirement for use.--Within 180 days after the date of 
     enactment of this Act, the Secretary of Homeland Security 
     shall deny entry of a vessel into the United States if the 
     containers carried by the vessel are not sealed with a high 
     security container seal approved under paragraph (1).
       (b) Identification Number.--
       (1) Requirement.--A shipment that is shipped to or from the 
     United States either directly or via a foreign port shall 
     have a designated universal transaction number.
       (2) Tracking.--The person responsible for the security of a 
     container shall record the universal transaction number 
     assigned to the shipment under paragraph (1), as well as any 
     seal identification number on the container, at every port of 
     entry and point at which the container is transferred from 
     one conveyance to another conveyance.
       (c) Pilot Program.--
       (1) Grants.--The Secretary of Homeland Security is 
     authorized to award grants to eligible entities to develop an 
     improved seal for cargo containers that--
       (A) permit the immediate detection of tampering with the 
     seal;
       (B) permit the immediate detection of tampering with the 
     walls, ceiling, or floor of a container that indicates a 
     person is attempting to improperly access the container; and
       (C) transmit information regarding tampering with the seal, 
     walls, ceiling, or floor of the container in real time to the 
     appropriate authorities at a remote location.
       (2) Application.--Each eligible entity seeking a grant 
     under this subsection shall submit an application to the 
     Secretary at such time, in such manner, and accompanied by 
     such information as the Secretary may reasonably require.
       (3) Eligible entity.--In this subsection, the term 
     ``eligible entity'' means any national laboratory, nonprofit 
     private organization, institution of higher education, or 
     other entity that the Secretary determines is eligible to 
     receive a grant authorized by paragraph (1).
       (d) Empty Containers.--
       (1) Certification.--The Secretary of Homeland Security 
     shall prescribe in regulations requirements for certification 
     of empty containers that are to be shipped to or from the 
     United States either directly or via a foreign port. Such 
     regulations shall require that an empty container--
       (A) be inspected and certified as empty prior to being 
     loaded onto a vessel for transportation to a United States 
     seaport; and
       (B) be sealed with a high security container seal approved 
     under subsection (a)(1) to enhance the security of United 
     States seaports.

     SEC. 235. OFFICE AND INSPECTION FACILITIES.

       (a) Operational Space in Seaports.--Each entity that owns 
     or operates a United States seaport that receives cargo from 
     a foreign country, whether governmental, quasi-governmental, 
     or private, shall provide to the Directorate permanent office 
     and inspection space within the seaport that is sufficient 
     for the Directorate officers at the seaport to carry out 
     their responsibilities. Such office and inspection space--
       (1) shall be provided at no cost to the Directorate; and
       (2) may be located outside the terminal area of the 
     seaport.
       (b) Inspection Technology.--The Secretary of Homeland 
     Security shall maintain permanent inspection facilities that 
     utilize available inspection technology in the space provided 
     at each seaport pursuant to subsection (a).

     SEC. 236. SECURITY GRANTS TO SEAPORTS.

       (a) Criteria for Awarding Grants.--Notwithstanding any 
     other provision of law, the Secretary of Homeland Security 
     shall use the proportion of the containerized imports that 
     are received at a United States seaport as a factor to be 
     considered when determining whether to select that seaport 
     for award of a competitive grant for security.
       (b) Definitions.--In this section:
       (1) Containerized imports.--The term ``containerized 
     imports'' means the number of twenty-foot equivalent units of 
     containerized imports that enter the United States annually 
     through a United States seaport as estimated by the Bureau of 
     Transportation Statistics of the Department of 
     Transportation.
       (2) Competitive grant for security.--The term ``competitive 
     grant for security'' means a grant of Federal financial 
     assistance that the Secretary of Homeland Security is 
     authorized to award to a United States seaport for the 
     purpose of enhancing security at the seaport, including a 
     grant of funds appropriated under the heading ``Maritime and 
     Land Security'' in title I of division I of the Consolidated 
     Appropriations Resolution, 2003 (Public Law 108-7).

                        TITLE III--AUTHORIZATION

     SEC. 301. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated to the Attorney 
     General and the Secretary of Homeland Security such sums as 
     are necessary to carry out this Act. Sums authorized to be 
     appropriated under this section are authorized to remain 
     available until expended.

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