[Congressional Record Volume 155, Number 59 (Wednesday, April 22, 2009)]
[Senate]
[Pages S4531-S4561]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


               FRAUD ENFORCEMENT AND RECOVERY ACT OF 2009

  The PRESIDING OFFICER. Under the previous order, the Senate will 
proceed to the consideration of S. 386, which the clerk will report by 
title.
  The bill clerk read as follows:

       A bill (S. 386) to improve enforcement of mortgage fraud, 
     securities fraud, financial institution fraud, and other 
     frauds related to federal assistance and relief programs, for 
     the recovery of funds lost to these frauds, and for other 
     purposes.

  The Senate proceeded to consider the bill, which had been reported 
from the Committee on the Judiciary with an amendment to strike all 
after the enacting clause and insert in lieu thereof the following:

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Fraud Enforcement and 
     Recovery Act of 2009'' or ``FERA''.

     SEC. 2. AMENDMENTS TO IMPROVE MORTGAGE, SECURITIES, AND 
                   FINANCIAL FRAUD RECOVERY AND ENFORCEMENT.

       (a) Definition of Financial Institution Amended To Include 
     Mortgage Lending Business.--Section 20 of title 18, United 
     States Code, is amended--
       (1) in paragraph (8), by striking ``or'' after the 
     semicolon;
       (2) in paragraph (9), by striking the period and inserting 
     ``; or''; and
       (3) by inserting at the end the following:
       ``(10) a mortgage lending business (as defined in section 
     27 of this title) or any person or entity that makes in whole 
     or in part a federally related mortgage loan as defined in 12 
     U.S.C. 2602(1).''.
       (b) Mortgage Lending Business Defined.--
       (1) In general.--Chapter 1 of title 18, United States Code, 
     is amended by inserting after section 26 the following:

     ``Sec. 27. Mortgage lending business defined.

       ``In this title, the term `mortgage lending business' means 
     an organization which finances or refinances any debt secured 
     by an interest in real estate, including private mortgage 
     companies and any subsidiaries of such organizations, and 
     whose activities affect interstate or foreign commerce.''.
       (2) Chapter analysis.--The chapter analysis for chapter 1 
     of title 18, United States Code, is amended by adding at the 
     end the following:

``27. Mortgage lending business defined.''.

       (c) False Statements in Mortgage Applications Amended To 
     Include False Statements by Mortgage Brokers and Agents of 
     Mortgage Lending Businesses.--Section 1014 of title 18, 
     United States Code, is amended by--
       (1) striking ``or'' after ``the International Banking Act 
     of 1978),''; and
       (2) inserting after ``section 25(a) of the Federal Reserve 
     Act'' the following: ``or a mortgage lending business whose 
     activities affect interstate or foreign commerce, or any 
     person or entity that makes in whole or in part a federally 
     related mortgage loan as defined in 12 U.S.C. 2602(1)''.
       (d) Major Fraud Against the Government Amended To Include 
     Economic Relief and Troubled Asset Relief Program Funds.--
     Section 1031(a) of title 18, United States Code, is amended 
     by--
       (1) inserting after ``or promises, in'' the following: 
     ``any grant, contract, subcontract, subsidy, loan, guarantee, 
     insurance or other form of Federal assistance, including 
     through the Troubled Assets Relief Program, an economic 
     stimulus, recovery or rescue plan provided by the Government, 
     or the Government's purchase of any preferred stock in a 
     company, or''; and
       (2) striking ``the contract, subcontract'' and inserting 
     ``such grant, contract, subcontract, subsidy, loan, 
     guarantee, insurance or other form of Federal assistance,''.
       (e) Securities Fraud Amended To Include Fraud Involving 
     Options and Futures in Commodities.--
       (1) In general.--Section 1348 of title 18, United States 
     Code, is amended--
       (A) in the caption, by inserting ``and commodities'' after 
     ``Securities'';
       (B) by inserting ``any commodity for future delivery, or 
     any option on a commodity for future delivery, or'' after 
     ``any person in connection with''; and
       (C) by inserting ``any commodity for future delivery, or 
     any option on a commodity for future delivery, or'' after 
     ``in connection with the purchase or sale of''.
       (2) Chapter analysis.--The item for section 1348 in the 
     chapter analysis for chapter 63 of title 18, United States 
     Code, is amended by inserting ``and commodities'' after 
     ``Securities''.
       (f) Money Laundering Amended To Define Proceeds of 
     Specified Unlawful Activity.--
       (1) Money laundering.--Section 1956(c) of title 18, United 
     States Code, is amended--
       (A) in paragraph (8), by striking the period and inserting 
     ``; and''; and
       (B) by inserting at the end the following:
       ``(9) the term `proceeds' means any property derived from 
     or obtained or retained, directly or indirectly, through some 
     form of unlawful activity, including the gross receipts of 
     such activity.''.
       (2) Monetary transactions.--Section 1957(f) of title 18, 
     United States Code, is amended by striking paragraph (3) and 
     inserting the following:
       ``(3) the terms `specified unlawful activity' and 
     `proceeds' shall have the meaning given those terms in 
     section 1956 of this title.''.
       (g) Making the International Money Laundering Statute Apply 
     to Tax Evasion.--Section 1956(a)(2)(A) of title 18, United 
     States Code, is amended by--
       (1) inserting ``(i)'' before ``with the intent to 
     promote''; and
       (2) adding at the end the following:
       ``(ii) with the intent to engage in conduct constituting a 
     violation of section 7201 or 7206 of the Internal Revenue 
     Code of 1986; or''.

     SEC. 3. ADDITIONAL FUNDING FOR INVESTIGATORS AND PROSECUTORS 
                   FOR MORTGAGE FRAUD, SECURITIES FRAUD, AND OTHER 
                   CASES INVOLVING FEDERAL ECONOMIC ASSISTANCE.

       (a) In General.--
       (1) Authorization.--There is authorized to be appropriated 
     to the Attorney General, to remain available until expended, 
     $165,000,000 for each of the fiscal years 2010 and 2011, for 
     the purposes of investigations, prosecutions, and civil 
     proceedings involving Federal assistance programs and 
     financial institutions, including financial institutions to 
     which this Act and amendments made by this Act apply.
       (2) Allocations.--With respect to fiscal years 2010 and 
     2011, the amount authorized to be appropriated under 
     paragraph (1) shall be allocated as follows:
       (A) Federal Bureau of Investigation: $75,000,000 for fiscal 
     year 2010 and $65,000,000 for fiscal year 2011.
       (B) The offices of the United States Attorneys: 
     $50,000,000.
       (C) The criminal division of the Department of Justice: 
     $20,000,000.
       (D) The civil division of the Department of Justice: 
     $15,000,000.
       (E) The tax division of the Department of Justice: 
     $5,000,000.
       (b) Additional Appropriations for the Postal Inspection 
     Service.--There is authorized to be appropriated to the 
     Postal Inspection Service of the United States Postal 
     Service, $30,000,000 for each of the fiscal years 2010 and 
     2011 for investigations involving Federal assistance programs 
     and financial institutions, including financial institutions 
     to which this Act and amendments made by this Act apply.
       (c) Additional Appropriations for the Inspector General for 
     the Department of Housing and Urban Development.--There is 
     authorized to be appropriated to the Inspector General of the 
     Department of Housing and Urban Development, $30,000,000 for 
     each of the fiscal years 2010 and 2011 for investigations 
     involving Federal assistance programs and financial 
     institutions, including financial institutions to which this 
     Act and amendments made by this Act apply.
       (d) Additional Appropriations for the United States Secret 
     Service.--There is authorized to be appropriated to the 
     United States Secret Service of the Department of Homeland 
     Security, $20,000,000 for each of the fiscal years 2010 and 
     2011 for investigations involving Federal assistance programs 
     and financial institutions, including financial institutions 
     to which this Act and amendments made by this Act apply.
       (e) Use of Funds.--The funds authorized to be appropriated 
     under subsections (a), (b), (c), and (d) shall be limited to 
     cover the costs of each listed agency or department for 
     investigating possible criminal, civil, or administrative 
     violations and for prosecuting criminal, civil, or 
     administrative proceedings involving financial crimes and 
     crimes against Federal assistance programs, including 
     mortgage fraud, securities fraud, financial institution 
     fraud, and other frauds related to Federal assistance and 
     relief programs.
       (f) Report to Congress.--Following the final expenditure of 
     all funds appropriated under this section that were 
     authorized by subsections (a), (b), (c), and (d) the Attorney 
     General, in consultation with the United States Postal 
     Inspection Service, the Inspector General for the Department 
     of Housing and Urban Development, and the Secretary of 
     Homeland Security, shall submit a joint report to Congress 
     identifying--
       (1) the amounts expended under subsections (a), (b), (c), 
     and (d) and a certification of compliance with the 
     requirements listed in subsection (e); and
       (2) the amounts recovered as a result of criminal or civil 
     restitution, fines, penalties, and other monetary recoveries 
     resulting from criminal, civil, or administrative proceedings 
     and settlements undertaken with funds authorized by this Act.

     SEC. 4. CLARIFICATIONS TO THE FALSE CLAIMS ACT TO REFLECT THE 
                   ORIGINAL INTENT OF THE LAW.

       (a) Clarification of the False Claims Act.--Section 3729 of 
     title 31, United States Code, is amended--
       (1) by striking subsection (a) and inserting the following:
       ``(a) Liability for Certain Acts.--
       ``(1) In general.--Subject to paragraph (2), any person 
     who--
       ``(A) knowingly presents, or causes to be presented, a 
     false or fraudulent claim for payment or approval;
       ``(B) knowingly makes, uses, or causes to be made or used, 
     a false record or statement material to a false or fraudulent 
     claim;
       ``(C) conspires to commit a violation of subparagraph (A), 
     (B), (D), (E), (F), or (G);
       ``(D) has possession, custody, or control of property or 
     money used, or to be used, by the Government and knowingly 
     delivers, or causes to be delivered, less than all of that 
     money or property;
       ``(E) is authorized to make or deliver a document 
     certifying receipt of property used, or to be used, by the 
     Government and, intending to defraud the Government, makes or 
     delivers the receipt without completely knowing that the 
     information on the receipt is true;
       ``(F) knowingly buys, or receives as a pledge of an 
     obligation or debt, public property from an officer or 
     employee of the Government, or a member of the Armed Forces, 
     who lawfully may not sell or pledge property; or

[[Page S4532]]

       ``(G) knowingly makes, uses, or causes to be made or used, 
     a false record or statement material to an obligation to pay 
     or transmit money or property to the Government, or knowingly 
     conceals or knowingly and improperly avoids or decreases an 
     obligation to pay or transmit money or property to the 
     Government,

     is liable to the United States Government for a civil penalty 
     of not less than $5,000 and not more than $10,000, as 
     adjusted by the Federal Civil Penalties Inflation Adjustment 
     Act of 1990 (28 U.S.C. 2461 note; Public Law 104-410), plus 3 
     times the amount of damages which the Government sustains 
     because of the act of that person.
       ``(2) Reduced damages.--If the court finds that--
       ``(A) the person committing the violation of this 
     subsection furnished officials of the United States 
     responsible for investigating false claims violations with 
     all information known to such person about the violation 
     within 30 days after the date on which the defendant first 
     obtained the information;
       ``(B) such person fully cooperated with any Government 
     investigation of such violation; and
       ``(C) at the time such person furnished the United States 
     with the information about the violation, no criminal 
     prosecution, civil action, or administrative action had 
     commenced under this title with respect to such violation, 
     and the person did not have actual knowledge of the existence 
     of an investigation into such violation,

     the court may assess not less than 2 times the amount of 
     damages which the Government sustains because of the act of 
     that person.
       ``(3) Costs of civil actions.--A person violating this 
     subsection shall also be liable to the United States 
     Government for the costs of a civil action brought to recover 
     any such penalty or damages.'';
       (2) by striking subsections (b) and (c) and inserting the 
     following:
       ``(b) Definitions.--For purposes of this section--
       ``(1) the terms `knowing' and `knowingly'--
       ``(A) mean that a person, with respect to information--
       ``(i) has actual knowledge of the information;
       ``(ii) acts in deliberate ignorance of the truth or falsity 
     of the information; or
       ``(iii) acts in reckless disregard of the truth or falsity 
     of the information; and
       ``(B) require no proof of specific intent to defraud;
       ``(2) the term `claim'--
       ``(A) means any request or demand, whether under a contract 
     or otherwise, for money or property and whether or not the 
     United States has title to the money or property, that--
       ``(i) is presented to an officer, employee, or agent of the 
     United States; or
       ``(ii) is made to a contractor, grantee, or other 
     recipient, if the money or property is to be spent or used on 
     the Government's behalf or to advance a Government program or 
     interest, and if the United States Government--

       ``(I) provides or has provided any portion of the money or 
     property requested or demanded; or
       ``(II) will reimburse such contractor, grantee, or other 
     recipient for any portion of the money or property which is 
     requested or demanded; and

       ``(B) does not include requests or demands for money or 
     property that the Government has paid to an individual as 
     compensation for Federal employment or as an income subsidy 
     with no restrictions on that individual's use of the money or 
     property;
       ``(3) the term `obligation' means a fixed duty, or a 
     contingent duty arising from an express or implied 
     contractual, quasi-contractual, grantor-grantee, licensor-
     licensee, statutory, fee-based, or similar relationship, and 
     the retention of any overpayment; and
       ``(4) the term `material' means having a natural tendency 
     to influence, or be capable of influencing, the payment or 
     receipt of money or property.'';
       (3) by redesignating subsections (d) and (e) as subsections 
     (c) and (d), respectively; and
       (4) in subsection (c), as redesignated, by striking 
     ``subparagraphs (A) through (C) of subsection (a)'' and 
     inserting ``subsection (a)(2)''.
       (b) Effective Date and Application.--The amendments made by 
     this section shall take effect on the date of enactment of 
     this Act and shall apply to conduct on or after the date of 
     enactment, except that subparagraph (B) of section 3729(a)(1) 
     of title 31, United States Code, as added by subsection 
     (a)(1), shall take effect as if enacted on June 7, 2008, and 
     apply to all claims under the False Claims Act (31 U.S.C. 
     3729 et seq.) that are pending on or after that date.

  Mr. LEAHY. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. LEAHY. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. LEAHY. Mr. President, I understand the distinguished Senator from 
Pennsylvania is about to come to the floor. As each of us probably have 
times we are going to have to be on and off the floor, I am going to 
begin my comments now.
  I said Monday at the outset of this debate on the motion to proceed 
to the fraud enforcement bill that I hoped the objection to proceeding 
and any filibuster effort against this bill would be short lived. I am 
glad to see that cooler heads have prevailed. That actually happens in 
the Senate now and then.
  After being delayed 2 days, we have agreement to turn to the Leahy-
Grassley Fraud Enforcement and Recovery Act. I thank the majority 
leader for his persistence. I regret that the weeks we spent reaching 
across the aisle for a time agreement on this bill were unavailing. The 
majority leader was required to file cloture to get us to this point.
  We are talking about going after people who defrauded American 
taxpayers, and the sooner we can go after them, the better we all are. 
I commend Senators Grassley and Kaufman, Klobuchar, Dorgan, and Shaheen 
for their statements to the Senate on Monday in support of this fraud 
enforcement bill. Their strong statements no doubt contributed to the 
reversal of the position that now allows us to proceed to what is a 
bipartisan fraud enforcement bill. In total, six Senators spoke in 
favor of the bill on Monday and no one spoke against. Each of us who 
spoke on Monday is a cosponsor. The bipartisan group of 16 Senators who 
have cosponsored this bill include, Senators Schumer, Murray, Bayh, 
Specter, Snowe, Harkin, Levin, Whitehouse, Rockefeller, and Sanders.
  On Monday, as the Senate debated the motion to proceed to the Leahy-
Grassley fraud enforcement bill, the Obama administration issued a 
Statement of Administration Policy on the bill.
  I ask unanimous consent to have a copy of the Statement of 
Administration Policy printed in the Record at the conclusion of my 
statement.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (See exhibit 1.)
  Mr. LEAHY. This statement begins:

       The Administration strongly supports enactment of S. 386. 
     Its provisions would provide Federal investigators and 
     prosecutors with significant new criminal and civil tools and 
     resources that would assist in holding accountable those who 
     have committed financial fraud.

  I thank the President and the administration for their strong 
support.
  The statement continues:

       [The] legislation would benefit U.S. taxpayers by both 
     addressing existing fraud and deterring waste, fraud and 
     abuse of public funds.

  That is something we all should be in favor of. They went on to add 
that it ``would provide needed resources to strained law enforcement 
agencies.'' Of course, pointing out what we all know, these additional 
resources will far more than pay for themselves through fines and 
penalties, restitution, damages, and forfeitures.
  But there is more of a human thing in here. We have families losing 
their homes, defrauded, and losing their life savings. People are 
defrauding them and getting away with it. I want to not only get the 
people who did it, but I want to deter others from doing it in the 
future.
  I said on Monday that the Justice Department and the FBI, the Secret 
Service, the special inspector general for TARP, law enforcement 
officers, and many good-government advocates supported the bill.
  As we continue our debate, I ask unanimous consent to have printed in 
the Record at the conclusion of my statement a number of editorials and 
news articles favorable to the legislation.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (See exhibit 2.)
  Mr. LEAHY. Just this weekend, the New York Times wrote that fraud 
enforcement must be one of our priorities as we rebuild our economy, 
not only to hold accountable those who committed fraud and contributed 
to these hard times but to protect our efforts to stabilize the banking 
system and to jump-start the economy. They wrote:

       While Washington is spending billions to shore up the 
     financial system, it is doing far too little to strengthen 
     the federal government's ability to investigate and prosecute 
     the sort of corporate and mortgage frauds that helped cause 
     the economic collapse.
       Those efforts--never fully adequate--have suffered in 
     recent years as money and people were shifted from white-
     collar fraud to anti-terrorist activities.

  That is precisely what law enforcement officials from the Justice 
Department and the FBI and the special inspector general for the 
Troubled Asset Relief Program told us in their testimony before the 
Judiciary Committee.

[[Page S4533]]

  As the Times wrote, referring to the Fraud Enforcement and Recovery 
Act:

       A bipartisan measure newly approved by the Senate Judiciary 
     Committee and now coming before the full Senate would begin 
     to close the enforcement gap . . . and strengthen existing 
     federal fraud and money-laundering provisions, updating the 
     definition of ``financial institution'' in federal fraud 
     statutes to include largely unregulated mortgage businesses, 
     for example, and reversing flawed court decisions that have 
     undermined the effectiveness of the False Claims Act, one of 
     the most potent weapons against government fraud.
       Like a similar enforcement buildup in response to the 
     savings and loan crises of the 1980s, this one will 
     contribute far more than it costs to the federal Treasury 
     through restitutions and asset recoveries. . . .Senators 
     should not be asking if the expenditure is affordable, but 
     whether it is enough.

  Every prosecutor I have talked to says they need this. I am willing 
to bet that every person who has been defrauded by some of these 
unregulated mortgage companies would give anything to have had this on 
the books and these people there 6 months or a year ago before they 
lost their life savings, before they lost their homes, their chance for 
their children to go to college, and before they lost the chance for 
retirement. But there are still millions of Americans at risk. Let's 
protect them. Let's show that we are against such crime and that we 
will provide the tools to stop it.
  One of the things every prosecutor knows and learns is, if you ask 
people if they are against crime, everybody is against crime. If you 
ask legislative bodies: Are you willing to pass resolutions against 
crime, of course they are. But then you ask the real question: Will you 
give us the tools to fight crime? That is where everybody goes: Well, 
let's see.
  Here are the tools to fight crime.
  This is something supported across the political spectrum. Look at 
the Washington Times, a very conservative newspaper. They raised very 
similar concerns about the need to fight fraud and protect the 
taxpayers' money being spent on the economic stimulus. In an editorial 
on March 26 entitled ``Stimulus Spending Ripe for Fraud,'' the 
Washington Times called for fraud enforcement. In commenting on an 
Energy Department official who was concerned with waste, fraud, and 
abuse in stimulus funding, they wrote:

       The same attitude must be adopted by all agencies 
     overseeing the implementation of the massive spending 
     measure.

  Well, they are right. They went on to say that simply having a Web 
site to provide greater transparency, while a good thing, is not 
enough. They said:

       [E]ven an unprecedented level of post-spending transparency 
     will do only so much to ensure waste is kept to a minimum. . 
     . . It will take more than a new Web site and the sort of 
     staff training the administration has implemented to turn an 
     understanding of the problem into real accountability. . . .

  The administration is, in fact, doing more than creating the most 
transparent Government in history. They are supporting this bill and 
its aggressive response to fraud enforcement. The bill will actually 
translate rhetoric into reality, a reality that can save billions. It 
is just the kind of action these editorials from the right to the left 
have asked for.
  Look at a front page article of March 12, entitled ``Financial Fraud 
Is the Focus of Prosecutors.'' The New York Times reported that fraud 
was surging, particularly mortgage fraud cases.
  It is very interesting. We talk about tough enforcement. The chairman 
of the House Banking Committee said, ``Rules don't work if people have 
no fear of them.'' Anybody in law enforcement can tell us that. Every 
State has laws against burglary, for example. But put two warehouses on 
the same street, one with a rusty lock on the door and no alarm system, 
no lights, one with a state-of-the-art alarm system, lights, the 
ability to call police immediately, and which one gets broken into? The 
law is the same. You are going to break into the one that is easy. You 
can have all the laws in the world on mortgage fraud, and if people 
think they are not going to be enforced, they are going to break those 
laws. If you believe the worst that will happen is you might get a 
fine, if you have a $100 million fraud operation going and you might 
get a $5 million fine, gee-whiz, that is the cost of doing business. If 
you find out, however, that you might go to prison, that in all 
likelihood you will go to prison as well as losing the money you 
defrauded from people and allow that money to go back to them, then you 
are going to think twice.
  Neil Barofsky, the special inspector general for the Troubled Assets 
Relief Program, issued a 250-page report warning yet again that the 
bank bailout funds are particularly vulnerable to fraud. He talked 
about protecting American taxpayers. He testified about similar 
concerns when he appeared before the Judiciary Committee in support of 
the bill.
  Strengthening fraud enforcement is a key priority for the President. 
During the campaign, President Obama promised to ``crack down on 
mortgage fraud professionals found guilty of fraud by increasing 
enforcement [but also] creating new criminal penalties.'' The 
President, in his budget to Congress, called for additional FBI agents 
``to investigate mortgage fraud and white collar crime,'' as well as 
hiring more Federal prosecutors and civil attorneys ``to protect 
investors, the market, and the Federal Government's investment of 
resources in the financial crisis, and the American public.'' 
Additional money was included in the initial recovery package for the 
FBI, but it was cut out during negotiations that led to its passage. 
This bill is our chance to authorize the necessary resources.
  I can't state enough, it is not enough to have a law on the books 
that says: Thou shalt not commit crime. It works only if people think 
they are going to get caught and they are going to lose the money they 
have stolen and they are going to go to jail on top of that. As long as 
people carrying out these frauds and these scams think they will never 
get caught, will never get prosecuted, the laws aren't tough enough, 
they are in an unregulated industry, nobody is going to go after them, 
why not keep trying. The worst that could happen is somewhere along the 
line you might have to give a little bit of the money back and keep 
scamming people, keep ruining people's lives, keep taking people's 
homes away from them, keep taking people's retirement accounts, keep 
taking the money they have saved for their kids to go to college. If 
all you think you might get is a little slap on the wrist or in all 
likelihood you will get away with it completely, what is to stop you?
  Obviously not a sense of morality, as we saw with Bernie Madoff and 
others. We have to have laws to stop them. We have to have enforcement 
of the laws. We have to have people go to prison for stealing 
retirement accounts and stealing children's money being saved for 
college and stealing homes through mortgages scams. We should pass 
this.
  I see the distinguished Senator from Pennsylvania in the Chamber. He 
is a man with a distinguished career, first as a prosecutor before he 
came here and now a man who has been both chairman and ranking member 
of the Senate Judiciary Committee. He understands this.
  I yield the floor.

                               Exhibit 1

                   Statement of Administration Policy


           S. 386--FRAUD ENFORCEMENT AND RECOVERY ACT OF 2009

        (Sen. Leahy (D) Vermont and 4 cosponsors, Apr. 20, 2009)

       The Administration strongly supports enactment of S. 386. 
     Its provisions would provide Federal investigators and 
     prosecutors with significant new criminal and civil tools and 
     resources that would assist in holding accountable those who 
     have committed financial fraud.
       Specifically, the legislative enhancements would help the 
     Department of Justice to combat mortgage fraud, securities 
     and commodities fraud, money laundering and related offenses, 
     and to protect taxpayer money that has been expended on 
     recent economic stimulus and rescue packages. Further, the 
     legislation would amend the False Claims Act (FCA) in several 
     important respects so that the FCA remains a potent and 
     useful weapon against the misuse of taxpayer funds. In 
     general, this legislation would benefit U.S. taxpayers by 
     both addressing existing fraud and deterring waste, fraud, 
     and abuse of public funds. Moreover, S. 386 would provide 
     needed resources to strained law enforcement agencies and 
     prosecutors that would enable the Department and its partners 
     to advance the pace and reach of the enforcement response to 
     the current economic crisis. These additional resources will 
     provide a return on investment through additional fines, 
     penalties, restitution, damages, and forfeitures. With the 
     tools and resources that S. 386 provides, the Department of 
     Justice and others would be better equipped to address the 
     challenges that face this Nation in difficult economic times 
     and to do their part to help the Nation respond to this 
     challenge.

[[Page S4534]]

                               Exhibit 2

                [From the New York Times, Apr. 18, 2009]

                              Fraud Factor

       While Washington is spending billions to shore up the 
     financial system, it is doing far too little to strengthen 
     the federal government's ability to investigate and prosecute 
     the sort of corporate and mortgage frauds that helped cause 
     the economic collapse.
       Those efforts--never fully adequate--have suffered in 
     recent years as money and people were shifted from white-
     collar fraud to anti-terrorist activities. Over time, the 
     ranks of fraud investigators and prosecutors were 
     dramatically thinned, leaving the F.B.I. and the larger 
     Justice Department ill prepared to keep pace with a 
     skyrocketing number of serious fraud allegations. Now they 
     are ill equipped to police the vast infusion of federal money 
     into the economy.
       A bipartisan measure newly approved by the Senate Judiciary 
     Committee and now coming before the full Senate would begin 
     to close the enforcement gap.
       Sponsored by Senators Patrick Leahy of Vermont and Edward 
     Kaufman of Delaware, both Democrats, and Senator Charles 
     Grassley, Republican of Iowa, the Fraud Enforcement and 
     Recovery Act of 2009 would significantly expand the number of 
     prosecutors, agents and analysts devoted to pursuing 
     financial crimes.
       It would strengthen existing federal fraud and money-
     laundering provisions, updating the definition of ``financial 
     institution'' in federal fraud statutes to include largely 
     unregulated mortgage businesses, for example, and reversing 
     flawed court decisions that have undermined the effectiveness 
     of the False Claims Act, one of the most potent weapons 
     against government fraud.
       The measure envisions spending $490 million over the next 
     two fiscal years. Like a similar enforcement buildup in 
     response to the savings and loan crisis of the 1980s, this 
     one will contribute far more than it costs to the federal 
     Treasury through restitutions and asset recoveries, according 
     to the Congressional Budget Office forecast. Senators should 
     not be asking if the expenditure is affordable, but whether 
     it is enough.
                                  ____


               [From the Washington Times, Mar. 26, 2009]

                Stimulus Spending Remains Ripe for Fraud

       The many billions shoveled to the Energy Department as part 
     of the $787 billion stimulus package recently signed into law 
     may provide a cautionary tale about potential abuse, judging 
     from a recent Energy Inspector General's warning.
       As if on cue, FBI Director Robert Mueller told Congress 
     yesterday that he, too, expects a surge in stimulus-related 
     fraud. ``Our expectation is that economic crimes will 
     continue to skyrocket,'' he said. ``. . . The unprecedented 
     level of financial resources committed by the federal 
     government . . . will lead to an inevitable increase in 
     economic crime and public corruption cases.''
       Undaunted, President Obama earlier this week continued his 
     intense promotion of the stimulus package, ignoring the great 
     potential for significant fraud as federal agencies rush to 
     dispense the money. He hyped the $59 billion for clean energy 
     and related tax incentives in the stimulus bill as a down 
     payment on an additional $150 billion in Energy Department 
     spending in his 2010 budget. He didn't seem to get the recent 
     warnings from Energy Inspector General Gregory Friedman about 
     the high probability for fraud and waste in distributing 
     stimulus dollars, which call into question the agency's 
     ability to even distribute the stimulus money effectively.
       Most importantly, Friedman, a Clinton-era appointee, 
     highlighted the need for a level of proactive accountability 
     historically absent in the federal bureaucracy. As reported 
     by Congress Daily, Friedman's memo last week to Energy 
     Secretary Steven Chu and other department officials argues 
     that the massive increase in funding going through the agency 
     will strain and fundamentally change the agency's mission 
     while creating the potential for rampant abuse. The stimulus 
     provides the agency over $38 billion in funding along with 
     authority over energy loans totaling $127 billion, spending 
     that dwarfs the $27 billion provided in the agency's 2009 
     budget.
       Friedman reportedly notes that during regular agency 
     operations misuse of funds, falsification of data, kickbacks, 
     bribes and other forms of fraud happen with ``troubling'' 
     frequency. He also argues, correctly, that anti-corruption 
     oversight should be a priority. Friedman's laudable honesty 
     exposes both the unintended consequences inherent in the 
     quickly passed package and the daunting task faced.
       The same attitude must be adopted by all agencies 
     overseeing the implementation of the massive spending 
     measure. What is true, or likely, at Energy is very likely 
     true or likely at other departments and agencies as well. 
     Exhibit ``A'' is the continued lax oversight and lack of 
     transparency seen with the Treasury Department's handing of 
     the banking industry bailout. The White House is yet to be 
     convincing that it is adequately addressing the potential of 
     a major waste of taxpayer funds.
       Recovery Accountability and Transparency Board chairman 
     Earl Devaney, who is functionally the chief auditor of the 
     stimulus package, told a House panel last week that some 
     fraud is inevitable. But he also expressed horror that 
     accounting industry standards for fraud acceptability is 7 
     percent, or $55 billion in taxpayer money. Devaney, who 
     has a reputation for vigilance, promised a zero tolerance 
     approach. That is very good to hear.
       With over 40 states launching websites intended to track 
     stimulus spending, Devaney's board will oversee the Web site 
     Recovery.gov, aimed at maintaining public access to the Fed's 
     spending records. The board aims to change the fact that the 
     federal government has never been particularly successful in 
     the timely and reliable tracking of spending data.
       But even an unprecedented level of post-spending 
     transparency will only do so much to ensure waste is kept to 
     a minimum. Perusing the data online only comes after the 
     fact. It will take more than a new Web site and the sort of 
     staff training the administration has implemented to turn an 
     understanding of the problem into real accountability.
       While some degree of waste is almost inevitable from any 
     government endeavor, the degree must not reach the level of 
     finding 7 percent fraud--$55 billion in the case of the 
     entire package--an acceptable figure. The White House is 
     saying the right thing by indicating zero is the goal, not 
     $55 billion. We can only hope their rhetoric translates into 
     additional action that defies history and saves billions.
                                  ____


                [From the New York Times, Mar. 12, 2009]

           Financial Fraud Is Focus of Attack by Prosecutors

                            (By David Segal)

       Spurred by rising public anger, federal and state 
     investigators are preparing for a surge of prosecutions of 
     financial fraud.
       Across the country, attorneys general have already begun 
     indicting dozens of loan processors, mortgage brokers and 
     bank officers. Last week alone, there were guilty pleas in 
     Minnesota, Delaware, North Carolina and Connecticut and 
     sentences in Florida and Vermont--all stemming from home loan 
     scams.
       With the Obama administration focused on stabilizing the 
     banks and restoring confidence in the stock market, it has 
     said little about federal civil or criminal charges. But its 
     proposed budget contains hints that it will add to this 
     weight of litigation, including money for more F.B.I. agents 
     to investigate mortgage fraud and white-collar crime, and a 
     13 percent raise for the Securities and Exchange Commission.
       Officials at the Justice Department have not said much in 
     public about their plans. But people who have met with 
     Attorney General Eric H. Holder Jr. say he is weighing a 
     range of strategies.
       ``It's clear that he and other top-level members of the 
     Obama administration want to seize the opportunity to send a 
     message of zero tolerance for mortgage fraud,'' said 
     Connecticut's attorney general, Richard Blumenthal, who 
     attended a meeting with Mr. Holder and other state attorneys 
     general last week in Washington. ``The only question is when 
     and how they will do it.''
       One person who had discussed the matter with Mr. Holder, 
     but declined to be identified because he was not authorized 
     to speak for the Justice Department, said that the attorney 
     general was deciding whether to form a task force to 
     centralize the effort or allow state attorneys general to 
     develop cases on their own.
       A Justice Department spokesman, Matthew A. Miller, would 
     not comment, other than to write by e-mail, ``It will be a 
     top priority of the Justice Department to hold accountable 
     executives who have engaged in fraudulent activities.''
       At the low end of the mortgage transaction ladder, state 
     prosecutors have had a relatively easy time prevailing, but 
     recent history suggests that the government's odds of winning 
     drop when they go after Wall Street executives. Some high-
     profile convictions have been won in the last decade, but 
     several of the Enron-related prosecutions and some cases 
     brought by Eliot Spitzer when he was New York's attorney 
     general fell apart or were overturned on appeal.
       As federal authorities decide on a course of action, 
     Congress is becoming impatient. Representative Barney Frank, 
     chairman of the House Financial Services Committee, announced 
     plans last week for a hearing on March 20, inviting Mr. 
     Holder, bank regulators and leaders of the S.E.C. to answer 
     questions about their enforcement plans.
       ``Rules don't work if people have no fear of them,'' Mr. 
     Frank, Democrat of Massachusetts, said. State and local 
     prosecutors, it seems, do not need the nudge. Last week, the 
     district attorney's office in Brooklyn announced the creation 
     of a real estate fraud unit, with 12 employees and a mandate 
     to ``address the recent flood of mortgage fraud cases 
     plaguing New Yorkers.'' In late February, Maryland unveiled a 
     mortgage fraud task force, bringing together 17 agencies to 
     streamline investigations.
       With all the state activity and portents of a new resolve 
     at the federal level, lawyers who defend white-collar clients 
     sense growing momentum to perp walk and prosecute executives 
     involved in the mortgage crisis.
       ``It's going to be open season,'' says Daniel M. 
     Petrocelli, a lawyer whose clients include Jeffrey K. 
     Skilling, the former chief executive of Enron. ``You'll see a 
     lot of indictments down the road, and you'll see a lot of 
     prosecutions that rely on vague theories of `deprivation of 
     honest services.' ''
       Many financial executives have hired lawyers in the last 
     few months, either through

[[Page S4535]]

     internal counsels or, more discreetly, on their own, several 
     lawyers who defend white-collar clients said.
       While assorted Wall Street executives have been prosecuted 
     over the years, any concerted legal attack on the financial 
     sector would have little precedent. After the Depression, 
     Congress formed what became known as the Pecora Commission, 
     which grilled top financiers. But the point was mostly to 
     embarrass them, and the upshot was to set the stage for 
     stricter regulations. The most indelible image of the 
     commission's hearings was a photo of J.P. Morgan Jr. with a 
     midget who had been plopped in his lap by an opportunistic 
     publicist.
       The question behind any cases brought against Wall Street 
     will boil down to this: Was the worst economic crisis in 
     decades caused by law-breaking or some terrible, but 
     noncriminal, mix of greed, naivete and blunders? The 
     challenge for the Obama administration will be to prove that 
     it was the former, said Michael F. Buchanan, a partner at 
     Jenner & Block and a former United States attorney in New 
     Jersey.
       ``We punish people for intentional misconduct, we don't 
     punish them for stupidity or innocent mistakes,'' he said. 
     ``If you're a prosecutor, you want evidence that shows real 
     dishonesty. You want something that shows that these people 
     were doing something wrong, and they knew it.''
       That nearly all of the banking industry acted the same, 
     possibly reckless, way could actually help any executive who 
     lands in court, lawyers said. The herdlike behavior suggested 
     that bankers were competing for business using widely shared 
     assumptions, rather than trying to get away with a crime. It 
     would be hard to prove that anyone broke the rules, these 
     lawyers said, since regulations in the riskiest parts of the 
     mortgage industry were so lax.
       One defense lawyer said he expected to argue that either 
     his clients did not understand the financial instruments they 
     were marketing, or were not warned of the dangers by 
     underlings.
       ``We'll all sing the stupidity song,'' said the lawyer, who 
     said he feared that speaking publicly by name would deter 
     potential clients. ``We'll all sing the `These guys never 
     told me' song.''
       But for government lawyers, the environment for corporate 
     fraud cases could scarcely be more inviting. It is not just 
     that the public's zeal for Wall Street pelts is high. The 
     resources are there, too, because some of the money once used 
     to fight terrorism is being shifted to fighting financial 
     fraud. And in recent years the use of wire fraud statutes has 
     expanded, allowing prosecutors to turn virtually anything 
     said or sent by e-mail in private into a federal crime, if it 
     contradicts what investors were told in public disclosures.
       Wire fraud charges were among those against two former Bear 
     Stearns managers who were arrested in June, accused of 
     praising their hedge fund to clients as they worried about it 
     to colleagues. Federal sentencing guidelines also link the 
     length of a prison term to the size of the financial loss to 
     the public. Given that so many billions have vaporized 
     recently, convictions could easily lead to life sentences, 
     defense lawyers said, and the mere threat of such sentences 
     gives prosecutors enormous leverage in settlement talks.
       ``There are executives now getting sentences longer than 
     murderers and rapists,'' said Mr. Petrocelli, the lawyer, 
     referring to white-collar prosecutions in recent years, 
     including that of Mr. Skilling of Enron, who is now serving a 
     24-year sentence for securities fraud and other crimes.
       Why has there not been a batch of subpoenas at the federal 
     level already? The Department of Justice is missing important 
     staff members, says Reid H. Weingarten, a defense lawyer and 
     former trial lawyer for the Justice Department. Former 
     members of the Justice Department say that prosecutors and 
     regulators are reluctant to act while the markets are in such 
     disarray for fear of further unnerving investors and the 
     public.
       Lawyers for white-collar clients say they expect to be 
     busy, but not all of them predict that means they will be 
     earning huge fees. In the past, the legal bills of Wall 
     Street higher-ups were paid by insurers that indemnified 
     them. But that is not necessarily the case with banks that 
     have gone bankrupt or disappeared.
       ``I know bankers are not now evoking much sympathy from the 
     public at large,'' Mr. Weingarten said. ``But these days many 
     Wall Street types are struggling mightily with mortgage 
     payments, tuition bills and health insurance. It's a very 
     different world out there now.''

  The PRESIDING OFFICER. The Senator from Pennsylvania.
  Mr. SPECTER. Mr. President, I have sought recognition to comment on 
the Fraud Enforcement Recovery Act, the legislation which is currently 
on the floor. Before the distinguished chairman leaves the Chamber, if 
I could have his attention, I agree with him about the importance of 
having strong law enforcement on crimes involving business fraud and on 
white-collar crimes. We are dealing with a financial situation where 
there are billions of dollars at stake, if not trillions. It is hard to 
know exactly how many zeros to add on. We are faced with a very 
desperate--strong word but understated if anything--challenge as to 
what to do with the economy worldwide. We had a $700 billion program 
proposed by President Bush for companies in trouble and a twin brother 
proposed by President Obama, $787 billion.
  As I travel through my State, all I hear are questions. I don't hear 
any commendations. The Congress is not exactly held in high esteem. And 
the questions are: Why are we bailing out companies which made bad 
business judgments? If somebody makes a bad business judgment, why 
shouldn't they sustain the loss instead of coming to the taxpayers for 
a bailout?

  You have these fancy Wall Street instruments. What is a derivative? 
Then there is the explanation about how no longer do you have mortgages 
with simply a home buyer and a banker, but you have all of these 
commercial papers lumped together and securitized. I do not know how 
long the word ``securitized'' has been in the dictionary. In fact, I am 
not sure it is in the dictionary, and most Americans are trying to find 
out what it means.
  You slice them up, and they are securitized, and they are sold around 
the world. Much of the time, they are filled with misrepresentations to 
the extent that they become fraud. Fraud is a crime, and you have 
prosecutions which are brought which involve extraordinary sums of 
money, and then there is a fine which looks big in the newspapers but 
not when compared to what has been involved. It is a license to do 
business or, perhaps more accurately, a license to steal. But if you 
have criminal prosecutions and you have jail sentences, that is 
meaningful.
  Mr. President, may I direct a question to the distinguished chairman.
  I say to the Senator, I believe you were a prosecuting attorney in 
Vermont. What experience did the Senator have on the difference between 
a fine and a tough jail sentence?
  Mr. LEAHY. Well, Mr. President, I suspect my experience is probably 
similar to that of the distinguished Senator from Pennsylvania. Fines, 
especially in these commercial fraud type things, were seen as the cost 
of doing business. If you steal $100 million, and you get a $5 million 
fine, then you stole $95 million. But if they think they are going to 
go to prison, that is when they think twice. We saw this after Enron 
and other things that when people actually believe they are going to go 
to prison, then they start thinking twice.
  I am sure this was the experience the Senator from Pennsylvania had. 
It is the experience I had. Nothing focuses the attention of somebody 
who is going to want to defraud someone if they think they are going to 
spend years in a tiny cell. That focuses their attention, and suddenly 
it is not worth the effort. That is what we want to do here because the 
people who are being defrauded are the most defenseless. They are the 
people who have lost their retirement. They are the people who have 
lost their homes. They are the people who have lost the ability to pay 
for their kids to go to college.
  The Senator from Pennsylvania is absolutely right.
  (Mrs. GILLIBRAND assumed the chair.)
  Mr. SPECTER. Madam President, may the Record show the Presiding 
Officer has changed while I was looking at Senator Leahy. I concur with 
what Prosecutor Leahy said. It bears out the experience I had when I 
was a prosecuting attorney myself: that jail sentences are important in 
the way to deal with this kind of crime.
  When I have been questioned by my constituents on my travels through 
Pennsylvania about who is going to be held accountable, and I tell them 
that the prospects for jail sentences are real, they are somewhat 
assuaged.
  Madam President, I note the distinguished Republican leader has come 
to the floor. If I may have his attention and make an inquiry. If he 
cares to take precedence--he is busier than I am, although I am very 
busy--I would be glad to yield to Senator McConnell.
  Mr. McCONNELL. Madam President, I was not seeking the floor. I was 
going to talk to the Senator from Pennsylvania when he finishes his 
remarks. So I am not seeking recognition.
  Mr. SPECTER. Well, I thank Senator McConnell for those comments.
  The statute which is on the floor--the bill which is on the floor, 
proposed statute--is a very important legislative

[[Page S4536]]

piece. It will strengthen law enforcement being directed against 
precisely the kinds of white-collar crime we are talking about.
  The bill authorizes $165 million a year for hiring fraud prosecutors 
in the Department of Justice, including $75 million for the FBI to 
bring on 190 additional special agents and more than 200 professional 
staff. The bill includes $50 million a year for the U.S. Attorneys' 
Offices to staff those strike forces. The bill authorizes $80 million a 
year over the next 2 years for the U.S. Postal Inspection Service, the 
Inspector General, the Secret Service, and the office of Housing and 
Urban Development.
  It amends the definition of ``financial institution'' to extend 
Federal fraud laws to mortgage lending businesses that are not directly 
regulated or insured by the Federal Government. These companies were 
responsible for nearly half of the residential mortgage market before 
the economic collapse, yet they remain today largely unregulated and 
outside the scope of traditional Federal fraud statutes. This bill will 
correct that.
  It amends the major fraud statute to protect funds expended under 
TARP, the Troubled Asset Relief Program, and the economic stimulus 
package. So we are providing criminal sanctions for the people who are 
going to misuse the moneys which have been appropriated in the past 
year.
  It amends the Federal securities crime statute to cover fraud schemes 
involving commodities futures and options, including derivatives 
involving the mortgage-backed securities that caused such damage to our 
banking system.
  It also amends the Federal money laundering statutes to cover not 
only profits but proceeds. The Supreme Court interpreted the statutes 
so narrowly that it needs modification. And there were also judicial 
interpretations of the False Claims Act which this legislation will 
correct.
  So this is a very important bill. That is a very short statement of 
the bill and its purpose. It is my hope anyone who has amendments would 
come to the floor to offer them. I believe this is a bill which will 
get very widespread support in the Senate. We have a great many 
important legislative matters behind it, so it would be my hope we 
could move this bill through expeditiously, giving people an 
opportunity to offer amendments if they have some. We would be looking 
for a time agreement as soon as we could construct one. So I urge my 
colleagues to come to the floor to help on this process.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Delaware.
  Mr. KAUFMAN. Madam President, I want to say, the Senator from 
Pennsylvania is someone who, when I was growing up in Philadelphia, was 
the district attorney there and known to be a tough and good 
prosecutor. So having Senator Specter speak to this bill says a lot 
about the bill and about the underpinnings of it.
  I want to make a few comments. This bill is important. The American 
people are upset and outraged with the abuses that have rocked the 
financial sector, and which has especially put so many Americans into 
dire financial straits.
  It is a good bill, plain and simple. I wish to run through some of 
the reasons why I think this bill is important and why I think it is 
one of the easiest votes a Member will make in this session of the 
Congress.
  First, this bill is a critical step to restoring investor confidence 
in the financial markets by assuring the public that criminal behavior 
by unscrupulous mortgage brokers and corrupt financiers will be 
prosecuted and punished.
  When I travel around and talk to people, they feel no one is paying a 
price for this--except the hard-working people out around America who 
have been hit so hard by this financial crisis. They do not feel as 
though the people on Wall Street, the people who did this, the people 
involved and the mortgage brokers are paying a price. Therefore, very 
importantly, they do not feel it is time to get back into the markets. 
They are concerned the markets are not fair and the markets are not on 
the up and up.
  So what we are going to do with this legislation is assure the public 
that criminal behavior by unscrupulous mortgage brokers and corrupt 
financiers will be prosecuted and punished.
  Second, this bill is a deterrent. Prosecuting white-collar crime 
today sends a message to those who would be tempted to cheat and 
defraud again. I do not want to be a party to the fact that 5, 10, 15, 
20 years from now people will be ready to make a financial deal and 
someone will say: This is breaking the law. We are doing something here 
that is against the law. And someone else will say: Well, they did that 
back in 2007, 2008, 2009, and no one ever was prosecuted for it. These 
are very complicated financial dealings. If we do this, we are going to 
be just fine because, remember, nobody went to jail for what happened. 
Frankly, if we do not add more FBI agents, more prosecutors, and more 
financial training, that is exactly what could happen.
  Third, this bill rebalances law enforcement resources. If you go back 
to September 11, many Federal agents were rightly redeployed from 
criminal work to counterterrorism. Counterterrorism was the key thing. 
We had to do something about this. We had to find the people who 
perpetrated 9/11. We had to find the people who could think about doing 
us harm in the future. So, rightfully, we moved FBI agents away from 
financial fraud and on to counterterrorism. But the problem is, we 
never replaced those agents.
  In 2008, we had less financial fraud cases brought than we had in 
2001. It is incredible to believe that in this environment we had less 
criminal cases brought in 2008 than in 2001. So what we have to do is 
rebalance law enforcement resources. That is what this bill does. It 
allows us to get more Federal agents, more prosecutors, and more 
training back to where it was before.
  We have about 240 FBI agents now working on financial fraud. At the 
height of the savings and loan crisis, we had over 1,000. So we want to 
get back to that level. We want to get the FBI agents back, get them 
the training they need, and get the prosecutors and the training they 
need. So this is a wonderful way to rebalance law enforcement 
resources.
  Fourth, this bill helps ensure that sophisticated criminals cannot 
cover their tracks and escape liability. Unless we get more agents 
working on these cases soon, the trails may go cold.
  I know many people in America watch ``Law & Order.'' They know if you 
do not catch a criminal usually within the first 24 hours, it is very 
difficult to ever catch them. I think in this case that is what is 
going on here. This is one of the reasons why we have to pass this 
bill, and pass this bill soon. Because when you have these complicated 
financial cases, the sooner you get to the case--before people can 
cover their tracks, before people can go back and clean up what they 
have done--the better. We need the FBI agents on the job gathering the 
data and gathering the information.
  Another point is, this bill modernizes several areas of Federal fraud 
law. Among other things, it updates the definition of ``financial 
institution'' to cover mortgage lending businesses that are not 
directly regulated or insured by the Federal Government.
  Remember, much of the things that went on, much of our problem had to 
do with the mortgage lending business. The fact is, people went out and 
searched for and had people take out mortgages, many of whom were not 
qualified to have the mortgages; then they bundled up the mortgages and 
securitized them and then went off and sold them. In this area, there 
is enough anecdotal evidence to indicate there was some kind of fraud 
going on with this.

  What this bill does is it makes financial fraud--it moves the 
mortgage lending businesses under the definition of ``financial 
institution'' so we can go after these folks.
  Sixth, this bill is money well spent. Taxpayers have paid billions 
for bailouts. We should spend the millions it would take to find and 
prosecute all those who should be in jail. Again, taxpayers have paid 
billions in bailouts. No American whom I talk to--no American in my 
home State of Delaware--can understand why we would not spend the money 
we need to spend to prosecute these people for the crimes they have 
committed. It sends the wrong signal to the American people if, in 
fact, we do not get these folks

[[Page S4537]]

and if we do not take the money and prosecute all those who were 
involved in this financial fraud.
  Next, this bill is an investment. This is easy. As I said, this is 
the easiest vote anyone will cast in this session of Congress. History 
tells us funds spent on fraud enforcement net money for the Government 
at a rate of $15 recovered for every dollar spent. I have heard from 
some people concerned about spending this money. I think I have gone 
through the points on why we should spend the money, but if you are 
fiscally and financially conservative and if you basically believe 
there is nothing the Federal Government should spend money on, there is 
one thing that even you will agree with, and that is spending $1 to get 
back $15. That is the most fiscally conservative program that has ever 
been invented in the history of the Federal Government. We have a 
program where we will have to spend some money, but we know we are 
going to get the money back but many times over.
  Finally, and I think most importantly, this bill will make it clear 
to all Americans that we hold Wall Street to the same standards as Main 
Street. We have to have people believe--it is essential to our system--
that if you break the law, you will suffer the consequences. Keep in 
mind that many banks and mortgage brokers avoided the subprime market 
and acted responsibly. Respect for the rule of law demands that we 
identify, investigate, and punish those who self-dealt millions of 
dollars to line their own pockets while leaving investors in the dark. 
However, we have to be careful about whom we are trying and whom we are 
prosecuting. This is not a witch hunt. We are not out to get everybody 
and nail everybody in this business, but we need the FBI agents and the 
prosecutors to make sure we get the right people and that they are 
prosecuted to the full extent of the law.
  I think the American people--I know the American people--are looking 
for swift action to restore faith in our financial markets and the rule 
of law. This bill is a great opportunity to do that.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. KAUFMAN. Madam President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. KAUFMAN. Madam President, I ask unanimous consent to speak as in 
morning business for 6 minutes for the purpose of introducing a bill.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Delaware is recognized.
  Mr. KAUFMAN. I thank the Chair.
  (The remarks of Mr. Kaufman pertaining to the introduction of S. 853 
are printed in today's Record under ``Statements on Introduced Bills 
and Joint Resolutions.'')
  Mr. KAUFMAN. Madam President, I note the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mrs. GILLIBRAND. Mr. President, I ask unanimous consent that the 
order for the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Kaufman). Without objection, it is so 
ordered.


                               Earth Day

  Mrs. GILLIBRAND. Mr. President, in honor of Earth Day, I want to 
share with you some of the experiences I had this week when I was in 
New York. I met with a number of students from the New York Harbor 
School. Robert Kennedy, Jr., joined me. We were celebrating the 
achievements and efforts this school has made to make a difference for 
our future. The school is focusing on teaching the next generation 
about the environment and offering an environmental education so that 
we can create the stewards of our air and water into the next 
generation.
  I was pleased to stand with Bobby Kennedy and these outstanding young 
people to discuss the importance of progressive environmental policy. I 
will partner with them and be a strong advocate for a greener New York 
and country.
  What was so exciting about these children is that they were telling 
me about the work they were doing to ensure a cleaner Hudson River, 
what they were doing to make sure we can have a cleaner environment and 
air. Their curiosity was extremely compelling and inspiring. We talked 
about how the work they were doing would allow for their communities to 
be safer, to be able to have a clean Hudson River so they can eat fish 
out of it someday, and to have air that is cleaner. They really did 
understand the relationship between the communities around them and 
what they could do to have an impact in the future.
  I met with Murray Fisher, the founder of the New York Harbor School. 
I met with him in Washington, and then I talked with him and his 
students in New York. The Harbor School brings innovative environmental 
and maritime-focused learning to the Bushwick neighborhood of 
Brooklyn--taking graduation rates from 20 percent, before their program 
began, to 75 percent this year. The student body of the school 
represents the most at-risk young people--80 percent come from 
households that are actually under the poverty line.
  The skills these children have been learning--measuring water quality 
and studying aquaculture--will enable them to be part of a green 
future, part of the energy revolution. It was inspiring not only to see 
young people so engaged and enthusiastic about environmental education 
but realizing in speaking with them that they now understand what it 
takes to have a cleaner New York and the impact it can have in their 
own lives. I asked a young girl what she hoped to do when she 
graduated. She said she wants to be a marine biologist. I asked a young 
man if this is something he thought could make a difference. He said: I 
think so because it can change the quality of water and air that we 
have. They see a future for themselves to be the stewards of our 
environment.
  Too often, the young people of low-income New York neighborhoods live 
with the risks of polluted environments. There are many brownfields 
sites across New York City, and the majority are located within the 
low-income people-of-color communities. Brownfields are clustered in 
these communities due to a history of industrial use, illegal dumping, 
or improper storage and handling of commercial products. These 
incidents have led to health hazards that further diminish the limited 
opportunities afforded many New Yorkers. For example, in the Bronx, we 
have the Nation's leading rate of asthma. In the Bronx neighborhood of 
Hunts Point, for example, we have one in four elementary children who 
suffers from asthma. I have been to the Bronx and to the community 
health center there, and I have met with parents. They do worry because 
the air quality is poor, and they have this historical environmental 
degradation.
  We need to do better by our communities and make sure every child in 
America has a chance to achieve his or her God-given potential. That 
means having clean air to breathe, safe water to drink, and a community 
that is healthy.
  When we bring our environmental education into our schools, such as 
the Harbor School, we are teaching children that they can have an 
impact on their environment and that it actually creates opportunities 
for them.
  The current economic challenges we face in New York and around the 
country are significant, but the programs that are offered by the New 
York Harbor School can really make a difference. Unfortunately, many of 
these programs are in jeopardy due to budget cuts, and schools are 
being forced to scale back environmental education. No Child Left 
Inside, introduced by Senator Jack Reed this week, would provide for 
environmental education in schools; it would provide the critical 
funding that is necessary to ensure our children receive the kinds of 
hands-on education that connects them with the environment and prepares 
them for our future.
  Despite all of the economic challenges our country is facing, we must 
not lose our focus on the important investments that are required to 
assure New York's and our Nation's leadership in the years to come. The 
environmental problems that many of our communities face are also 
opportunities for the young people of the Harbor

[[Page S4538]]

School to be the problem-solvers of the future and to be able to make a 
difference in their own communities.
  Bobby Kennedy recognized early on that State and Federal 
environmental legislation cannot only be positive for air, land, and 
water, but also good for the economy and job creation. He said to me:

       We can turn every American into an energy entrepreneur, 
     every home into a power plant, and fuel our country through 
     our own energy initiatives, rather than Saudi oil.

  I thought that statement was extremely inspiring. He is saying that 
through energy entrepreneurialism and innovation, we can transform this 
economy not only into a green economy but into an energy revolution 
where we are creating not only the products through energy sources--
whether it is fuel cells, hydropower, wind, solar, biofuel, or 
cellulosic ethanol--but we have the opportunity to transform 
manufacturing in this country to create the new products that are going 
to run on these new energy sources. It is a recognition that there is 
extraordinary opportunity here to make an opportunity for every 
individual, every home, and every business to be part of the energy 
solution.
  As a country, we have undertaken infrastructure projects with the 
understanding that once the upfront costs were incurred and building 
was completed, private investment would follow, creating lucrative 
paths of commerce. This has been seen throughout New York's history. In 
the early days of America, we had one very audacious building project 
called the Erie Canal. It was going to connect Lake Erie to the Hudson 
River, opening markets of the eastern seaboard to inland goods. Even 
some visionaries, such as Thomas Jefferson, didn't think it was a very 
good idea, calling it ``a little short of lunacy,'' and ultimately it 
fell on New York State, under Gov. Dewitt Clinton's leadership, to fund 
the project. The Erie Canal contributed immensely to the economic 
growth and wealth of New York. From New York City through Buffalo, it 
made an enormous difference to open Upstate New York and western New 
York to commerce, and that legacy continues to be with us today.
  That is why the vision of President Obama on new infrastructure is so 
important. Today, we have high-speed rail, which is a great opportunity 
for mass transit. If we can have high-speed rail from New York City to 
Niagara, again it would open not only downstate to upstate but upstate 
to the rest of the eastern seaboard. It is very exciting to be able to 
create these opportunities for long-term economic growth.
  The same thing is true with the power grid. When T. Boone Pickens 
talks about his windmills, he cannot build them if he doesn't have 
anyplace to plug in. We cannot have electric cars that can transform 
the entire automotive industry if we don't have a place to plug in. 
That is what President Obama's vision is in terms of building the new 
electric grid, so we can have sustainable, renewable energy and be able 
to use the new technologies and innovations to drive a new economy.
  New York is in the enviable position to lead the Nation's green 
movement. We have had a history of energy independence. We have had 
hydropower for well over 100 years, whether you are talking about the 
Hudson River Valley or Niagara Falls. We have some of the greatest 
agriculture in the whole Nation, so we can be a source for cellulosic 
ethanol and other biofuels. We have some of the greatest entrepreneurs 
of this generation, from fantastic SUNY schools to terrific engineering 
schools, including engineering students from RPI, where we are at the 
forefront of photovoltaic energy, wind, and solar. We are in a position 
to lead the Nation's recovery through energy independence.
  I celebrate Earth Day today by commending the great work of the 
Harbor School and the extraordinary leadership of Robert F. Kennedy, 
Jr., and also to talk about our future because when children are 
interested in learning about the environment and they create a 
relationship to the environment, whether it is through cleaner air or 
cleaner water or being that young engineer who figures out how to build 
an electric car for $25,000 so all of America can get the equivalent of 
240 miles per gallon, that is a vision of the future that I see, and 
that is the vision of how we are going to turn the economy around and 
create jobs.
  I will work with President Obama to make sure we create good-paying 
jobs all across New York.
  Thank you, Mr. President.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. REID. Madam President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mrs. Gillibrand). Without objection, it is so 
ordered.
  Mr. REID. Madam President, it is my understanding that we are on the 
financial fraud legislation.
  The PRESIDING OFFICER. That is correct.
  Mr. REID. That vehicle is open for amendment, true?
  The PRESIDING OFFICER. That is correct.


                           Amendment No. 984

  Mr. REID. Madam President, I send an amendment to the desk.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Nevada [Mr. Reid] proposes an amendment 
     numbered 984.

  Mr. REID. Madam President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

   (Purpose: To increase funding for certain HUD programs to assist 
      individuals to better withstand the current mortgage crisis)

       At the appropriate place, insert the following:

     SEC. ____. ADDITIONAL FUNDING FOR HUD PROGRAMS TO ASSIST 
                   INDIVIDUALS TO BETTER WITHSTAND THE CURRENT 
                   MORTGAGE CRISIS.

       (a) Additional Appropriations for Advertising in Support of 
     HUD Programs.--There is authorized to be appropriated to the 
     Secretary of Housing and Urban Development, to remain 
     available until expended, $10,000,000 for each of the fiscal 
     years 2010 and 2011 for purposes of providing additional 
     resources to be used for advertising in support of HUD 
     programs and approved counseling agencies, provided that such 
     amounts are used to advertise in the 50 metropolitan 
     statistical areas with the highest incidence of home 
     foreclosures per capita, and provided, further that at least 
     $5,000,000 of such amounts are used for Spanish-language 
     advertisements.
       (b) Additional Appropriations for the Housing Counseling 
     Assistance Program.--There is authorized to be appropriated 
     to the Secretary of Housing and Urban Development, to remain 
     available until expended, $50,000,000 for each of the fiscal 
     years 2010 and 2011 to carry out the Housing Counseling 
     Assistance Program established within the Department of 
     Housing and Urban Development, provided that such amounts are 
     used to fund HUD-certified housing-counseling agencies 
     located in the 50 metropolitan statistical areas with the 
     highest incidence of home foreclosures per capita for the 
     purpose of assisting homeowners with inquiries regarding 
     mortgage-modification assistance and mortgage scams.
       (c) Additional Appropriations for Personnel at the Office 
     of Fair Housing and Equal Opportunity.--There is authorized 
     to be appropriated to the Secretary of Housing and Urban 
     Development, to remain available until expended, $5,000,000 
     for each of the fiscal years 2010 and 2011 for purposes of 
     hiring additional personnel at the Office of Fair Housing and 
     Equal Opportunity within the Department of Housing and Urban 
     Development, provided that such amounts are used to hire 
     personnel at the local branches of such Office located in the 
     50 metropolitan statistical areas with the highest incidence 
     of home foreclosures per capita.

  Mr. REID. Madam President, what we hear on the morning news almost 
every day--but today especially--is that there are problems in the 
housing industry around America. Today, they listed the top 10 cities 
for foreclosure. No. 1 is Las Vegas. We have a lot in common with nine 
other cities. Many of the 10 are in California, and Phoenix, AZ, is 
one, and there are places in Michigan and in Florida.
  I hope this amendment can be worked out with the managers. It is an 
amendment that authorizes money in three different areas: $10 million 
to HUD for the purpose of providing resources to be used for 
advertising in support of HUD programs and approved counseling agencies 
in the 50 metropolitan statistical areas with the highest incidence of 
home foreclosures per capita. At least half of those resources are to 
be used for Spanish-language advertising. We have found that in Las

[[Page S4539]]

Vegas, which has a significant number of Spanish-speaking people, they 
are being scammed by people who are trying to take advantage of them 
and others. The rationale is that some of these metropolitan 
statistical areas are being flooded with advertising from illegitimate 
actors promising mortgage reductions and modifications for a fee. HUD 
will use these funds to advertise HUD services, as well as to explain 
the availability of HUD-approved counseling to homeowners to avoid some 
of these scams.
  No. 2 is the authorization of $50 million to be provided through the 
Housing Counseling Program at the Department of Housing and Urban 
Development to HUD-certified housing counseling agencies located in the 
50 metropolitan statistical areas. These would be areas with the 
highest incidence of home foreclosures per capita, for the purpose of 
assisting homeowners with inquiries regarding mortgage modification 
assistance and mortgage scams.
  We have found in the economic recovery package, and in the housing 
bill, that direct moneys went to these agencies--approved agencies--to 
help them talk to people and counsel them as to what they can do to 
avoid foreclosure. It has worked very well.

  The 2008 housing bill and subsequent spending bills directed funds to 
counseling agencies, but the metropolitan statistical areas that are 
hardest hit--Las Vegas among those--still need more resources given the 
depth of the problem.
  Additional resources will allow HUD-certified agencies to staff up 
and meet growing demand for their services, which will counterbalance 
the increase in illegitimate agencies promising mortgage modification 
services for a fee. These entities that are going to get this money 
charge nothing.
  Finally, Madam President, the authorization of $5 million to HUD's 
Office of Fair Housing and Equal Opportunity will help to provide 
additional personnel in HUD offices located in these 50 areas with the 
highest incidence of foreclosure. The rationale, of course, is that 
local HUD offices in these areas are understaffed and unable to meet 
the demand for their services and expertise concerning mortgage scams. 
Fair Housing Program personnel are trained to address these issues, and 
they are badly needed.
  I would hope the managers and those other Members who are interested 
in this issue would review this matter. We believe strongly this is the 
right direction. If people have a better idea, I would be happy to 
visit with them. I will not call for a vote until people, of course, 
have an opportunity to review this in detail.
  The PRESIDING OFFICER. The Republican whip.


                           Amendment No. 985

  Mr. KYL. Madam President, I ask unanimous consent to lay aside the 
pending amendment for purposes of offering an amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered. The clerk 
will report the amendment.
  The assistant legislative clerk read as follows:

       The Senator from Arizona [Mr. Kyl] proposes an amendment 
     numbered 985.

  Mr. KYL. Madam President, I ask unanimous consent that further 
reading of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

     (Purpose: To modify the definition of the term ``obligation'')

       On page 26, strike lines 1 through 5, and insert the 
     following:
       ``(3) the term `obligation' means an established duty, 
     whether or not fixed, arising from an express or implied 
     contractual, grantor-grantee, or licensor-licensee 
     relationship, from a fee-based or similar relationship, from 
     statute or regulation, or from the retention of any 
     overpayment; and

  Mr. KYL. Madam President, let me describe this amendment briefly and 
note that it is my understanding that when Senator Leahy is able to be 
on the Senate floor, it is his intention to suggest that we take this 
amendment by unanimous consent. It has been worked out with 
representatives on both sides of the aisle, but I would like to 
describe it briefly.
  This is an amendment relating to section 4 of the bill, which amends 
the False Claims Act. My amendment replaces the bill's proposed 
definition of the word ``obligation,'' which has important implications 
for the so-called ``reverse'' False Claims Act pursuant to which 
private parties may be held liable for failing to pay an obligation due 
to the United States.
  This amendment originally grew out of concerns about the underlying 
bill that were raised by the Chamber of Commerce and other business 
groups. Having reviewed those concerns, I have concluded that some of 
them could only arise under a strained reading of the bill.
  The bill's new definition of the word ``obligation,'' in particular, 
posed several problems. The original language spoke of ``contingent'' 
obligations. Such contingent or potential duties could include duties 
to pay penalties or fines, which could arise--and at least become 
``contingent'' obligations--as soon as the conduct that is the basis 
for the fine has occurred.
  Obviously, we don't want the Government or anyone else suing under 
the False Claims Act to treble and enforce a fine before the duty to 
pay that fine has been formally established. It is unlikely that 
Justice would ever have brought suit to enforce a claim of this nature, 
but the FCA can also be enforced by private realtors who often may be 
motivated by personal gain and not always exercise the same good 
judgment that the Government usually does.
  To preclude such a reading of the act, my amendment strikes 
contingent obligations from the FCA's new definition of ``obligation.''
  My amendment also makes a few other housekeeping changes to the 
definition of ``obligation.'' It removes the words ``quasi-contractual 
relationship.'' A ``quasi-contract'' is a remedy for a breach of duty, 
not an independent source of a duty. The amendment also makes clear 
that the words ``similar relationship'' only modify the words ``fee-
based relationship'' and not the entire list of relationships that 
precede that term.
  Under some readings of the rule of the last antecedent, the comma in 
the committee-reported bill that preceded the words ``or similar 
relationship'' could be read to reverse the usual presumption of that 
rule and have the words ``similar relationship'' modify all of the 
words in that list. My amendment makes clear that ``similar 
relationship'' only modifies ``fee-based relationship.''
  As a result of discussions with the sponsors of the bill, I have also 
agreed to allow my amendment to add duties arising out of regulations, 
rather than just statutes, to the list of obligations made actionable 
under the law. I declined, however, to also allow obligations to be 
enforced that arise out of a mere rule. The term ``rule'' is defined at 
section 551 of title V, and as that definition makes clear, the term is 
far too broad. It can include all manner of rules of which defendants 
would have no reasonable notice.
  Regulations, on the other hand, are published in the Federal Register 
in the Code of Federal Regulations, and so Congress can reasonably 
expect participants in regulated industries to have notice of them. 
Thus, as amended, the term ``obligation'' encompasses duties arising 
out of statutes and out of formal regulations published in the CFR.
  I might also say a few words about aspects of the definition of 
obligation that I ultimately concluded that it was not necessary to 
address in this amendment. At the Judiciary Committee's mark up of this 
bill, I circulated an amendment that would limit obligations arising 
out the retention of any overpayment so as to make clear that no 
obligation arises if the defendant is pursuing some type of 
administrative, judicial, or other process for reconciliation of 
alleged overpayments. The sponsors of the bill raised the concern, 
however, that such a safe harbor might immunize parties that 
intentionally and maliciously obtain an overpayment, and then spend 
years exhausting a reconciliation process, all in bad faith and knowing 
full well that they must repay the money, but earning interest on the 
overpayment in the interim. Apparently incidents like this have 
occurred, in cases involving sums that allowed the defendant to earn 
tens of millions of dollars in interest. The sponsors of the bill also 
noted to me that, under subparagraph (G)'s modification of the reverse 
False Claims

[[Page S4540]]

Act, avoiding or decreasing an obligation is only actionable, in 
relevant part, if the defendant ``knowingly and improperly avoids or 
decreases an obligation to pay or transmit money or property to the 
Government.'' Therefore, a good-faith pursuit of a reconciliation 
process would not be actionable.
  I asked my staff to research the meaning of ``knowingly and 
improperly'' to confirm that a person who pursues reconciliation of an 
overpayment in good faith could not be held liable under the reverse 
False Claims Act. The answer that I received is that the term 
``knowingly and improperly,'' though infrequently used in the caselaw, 
is consistently construed to mean that a person either acted with bad 
intent or that he employed means that are inherently tortious or 
illegal.
  For example, the State of Massachusetts uses the standard of 
``knowing and improper'' to determine whether a business competitor's 
inducing a third party to breach a contract constitutes tortious 
interference with contract. See Boyle v. Boston Foundation, Inc., 788 
F.Supp. 627 (D. Mass. 1992); Restuccia v. Burk Technology, Inc., 1996 
WL 1329386, at *3 (Aug. 13, 1996). And as the cases giving content to 
the Massachusetts standard make clear, under that test the 
``[d]efendant's liability may arise from improper motives or from the 
use of improper means.'' United Truck Leasing Corp. v. Geltman, 406 
Mass. 811, 816 (1990) (quoting Top Service Body Shop, Inc. v. Allstate 
Ins. Co., 283 Or. 201, 209-210 (1978). See also United Truck Leasing at 
pages 816-817, quoting other cases as construing this standard to 
require an ``improper purpose or improper means.'' The Top Service Body 
Shop case, quoted by the Massachusetts court, further elaborates, at 
footnote 11, on what types of means constitute ``improper means.'' 
These are noted to commonly include ``violence, threats or other 
intimidation, deceit or misrepresentation, bribery, unfounded 
litigation, defamation, or disparaging falsehood.'' In the False Claim 
Act context, this list may include other improper means, but ``improper 
means'' must be means that are malum in se--that is, means that are 
inherently wrongful and constitute an independent tort.
  Though less carefully considered than the Massachusetts intentional-
interference jurisprudence, other judicial uses of the words ``knowing 
and improper'' confirm that the term would not reach good-faith 
exhaustion of procedures for reconciling an overpayment. In the Matter 
of Banas, 144 N.J. 75, 81 (1996), for example, reprimands a lawyer for 
``knowingly and improperly retaining--his client's--$5,000 payment.'' 
And the court makes clear that it bases this conclusion on a previous 
finding that the lawyer ``knew from the beginning that the purpose of 
the payment'' was to satisfy a condition that he had not met. See Banas 
at 80. In another attorney-sanctions case, In re Aston-Nevada Limited 
Partnership, 391 B.R. 84, 102 (D. Nev. 2006), the court found that the 
lawyer ``repeatedly, knowingly, and improperly'' misused particular 
words in his filings, and then emphasized that the lawyer's 
``prevarications and misstatements were deliberate and not careless.''
  Given that the words ``knowingly and improperly'' have a fixed 
meaning that, at the very least, requires either improper motives or 
inherently improper means, the changes made by this bill cannot be read 
to make actionable the retention of an overpayment when the defendant 
is pursuing in good-faith the exhaustion of a reconciliation procedure. 
It is with this understanding that I have declined to insist on further 
qualification of the bill's predication of liability on the retention 
of an overpayment.
  Finally, as a matter of usage, I would note that, contrary to the 
wording of the bill's new definition of ``obligation,'' duties arise 
from contracts and the like, not from ``relationships.'' The bill's 
language is somewhat Oprahfied in this regard, but given that the 
sponsors have accommodated me on other, more substantial issues, I did 
not think it worth forcing a rewording of the provision to address this 
problem.
  Other groups have also suggested the bill's new definition of the 
word ``claim,'' by encompassing situations where money is spent or used 
``to advance a government program or interest,'' could make actionable 
under the False Claims Act any garden-variety overbilling or 
underpayment of a contractor by a subcontractor if some Federal money 
is involved in the project. I think this is an unreasonable reading of 
the bill that is precluded by the committee report, as well as by 
common sense. The report makes clear that the purpose of the new 
definition of ``claim'' is to overrule the Totten and Allison Engine 
cases and preclude application of a formalistic presentment requirement 
of an unnecessary intent requirement, and to restore the previous 
understanding of the law. And that previous understanding, as well as 
common sense, dictate that a particular transaction does not ``advance 
a Government program or interest'' unless it is predominantly federal 
in character--something that at least would require, as the report 
notes in footnote 4, that the claim ultimately results in a loss to the 
government. Obviously, the government does not intend to make 
actionable under the FCA any garden-variety dispute between a general 
contractor and a subcontractor simply because the general receives some 
federal money. On the other hand, if the transaction is still 
predominantly Federal in character, and the false claim results in a 
loss to the government, recovery under the FCA should not be precluded 
simply because the claim was not directly presented to the government, 
or because the malfeasant did not specifically intend to defraud the 
government.
  Madam President, I ask unanimous consent to lay aside this amendment 
for the purpose of calling up four other amendments pending at the 
desk, and those numbers are 986, 987, 988, and 989.
  Mr. KAUFMAN. Will the Senator please yield so we have a chance to 
look at the amendments?
  The PRESIDING OFFICER. Is there objection?
  Mr. KAUFMAN. Object.
  The PRESIDING OFFICER. Objection is heard.
  Mr. KYL. I am happy to share these amendments with the other side, 
but I was not aware the other side had a veto over amendments offered 
by Members of this side of the aisle.
  Mr. KAUFMAN. I would just like to----
  Mr. KYL. I am happy to share the amendment, of course. I will 
withhold for a moment so the Senator can see what the amendment is, and 
perhaps we can move forward.
  Mr. KAUFMAN. Madam President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. LEAHY. Madam President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER (Mrs. Hagan). Without objection, it is so 
ordered.
  Mr. LEAHY. Madam President, I understand there is a pending 
amendment?
  The PRESIDING OFFICER. The Senator is correct.
  Mr. LEAHY. I ask unanimous consent that the pending amendment be set 
aside and it be in order for me to send an amendment to the desk.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 993

  Mr. LEAHY. Madam President, I send to the desk an amendment on behalf 
of myself and Senator Grassley. I ask for its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The bill clerk read as follows:

       The Senator from Vermont [Mr. Leahy], for himself and Mr. 
     Grassley, proposes an amendment numbered 993.

  Mr. LEAHY. I ask unanimous consent that the reading of the amendment 
be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

      (Purpose: To clarify the amendments relating to major fraud)

       On page 15, strike beginning with line 20 through page 16, 
     line 10, and insert the following:
       (d) Major Fraud Against the Government Amended to Include 
     Economic Relief and Troubled Asset Relief Program Funds.--
     Section 1031(a) of title 18, United States Code, is amended 
     by--
       (1) inserting after ``or promises, in'' the following: 
     ``any grant, contract, subcontract, subsidy, loan, guarantee, 
     insurance or other form of Federal assistance, including

[[Page S4541]]

     through the Troubled Assets Relief Program, an economic 
     stimulus, recovery or rescue plan provided by the Government, 
     the Government's purchase of any troubled asset as defined in 
     the Emergency Economic Stabilization Act of 2008, or in'';
       (2) striking ``the contract, subcontract'' and inserting 
     ``such grant, contract, subcontract, subsidy, loan, 
     guarantee, insurance or other form of Federal assistance,''; 
     and
       (3) striking ``for such property or services''.

  Mr. LEAHY. Madam President, I rise to explain what this is, and then 
I will try to schedule a vote on the Kyl amendment and the Grassley-
Leahy amendment at some time, I hope in the next few minutes.
  As we begin consideration of the bill, Senator Grassley and I are 
offering a brief managers' amendment. I was just explaining for 
everybody that it makes two simple technical changes in the bill in 
order to clarify the original intent of the bill and in order to avoid 
any ambiguity in the statutory language. It makes sure the bill extends 
the major fraud statute to all the funds being expended to stabilize 
and strengthen our banking system.
  The original language in the bill amended the major fraud statute to 
protect against frauds related to many Government economic recovery 
programs, including the purchase of ``preferred stock in a company'' by 
the Government as part of our efforts to stabilize banks. The Justice 
Department advises that this language may be too narrow, as recovery 
efforts may include purchases of other types of stock or other troubled 
assets. So the Justice Department, which supports the Leahy-Grassley 
bill, has requested that the reference to ``any preferred stock in a 
company'' be replaced with the phrase ``any troubled asset as defined 
in the Emergency Economic Stabilization Act of 2008.'' This simple 
change will make clear that all troubled assets purchased by the 
Government as part of the recovery effort will be covered under the 
major fraud statute. This change is consistent with the original intent 
of the bill and simply provides greater assurances that taxpayers' 
money will be protected to the full extent of the Federal law.
  Second, the amendment strikes five words in the bill that could 
create unintended ambiguity in the statute and could be used to limit 
the effect of the bill. The phrase ``for such property or services'' 
appears in the original statute as a modifier of the kinds of contracts 
or subcontracts covered by the major fraud statute. With the changes 
included in the bill, the language is no longer applicable because the 
transactions involved in our efforts to stabilize banks include grants, 
loans, and purchases of assets that may not legally be characterized as 
``property or services.'' If this phrase remained in the statute, it 
could be used improperly to limit the scope of the major fraud statute 
and undermine the intent of this legislation, which is to cover all of 
the Government's efforts to rebuild our economy and restart our banking 
system.
  Frankly, when we send prosecutors out to get people for defrauding 
Americans, I don't want to have something unintentionally in the 
statute which may limit the ability of prosecutors to go after those 
who are defrauding Americans.
  These changes that have been requested and supported by the Justice 
Department have the full support of Senator Grassley, the lead 
Republican cosponsor of this bill and the Republican manager for this 
bill. All Senators should support this bipartisan managers' amendment 
which should protect our efforts to strengthen the banking system and 
restart the economy.
  What I am going to do, Madam President, I am going to suggest that 
when Senator Kyl gets here and Senator Grassley gets back to the floor, 
we accept this managers' amendment--I think it is noncontroversial--and 
that we then have a vote as soon as he has had a chance to say what he 
would like to on the Kyl amendment. In the meantime, we will leave the 
managers' amendment the pending amendment just so Senators then can 
understand, if we can work it that way, hopefully we will have a vote 
relatively soon.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. SANDERS. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  (The remarks of Mr. Sanders are printed in today's Record under 
``Morning Business.'')
  Mr. SANDERS. Mr. President, I now wish to speak in support of S. 386, 
the Trade Enforcement Recovery Act. I commend Senator Leahy, my 
colleague from Vermont, the chairman of the Judiciary Committee, for 
introducing this important piece of legislation.
  As a result of the greed, recklessness and, in my view, illegal 
behavior of a handful of executives on Wall Street, we are suffering 
today from the most severe economic crisis that we have experienced 
since the Great Depression.
  Millions of people have lost their homes, their jobs, their life 
savings, their ability to send their kids to college, and their sense 
of hope that their children will follow the American dream and have a 
higher standard of living than they do.
  It is critical that we provide the FBI, the Justice Department, and 
all our Federal agencies the tools and resources they need to hold 
those responsible for the financial crisis accountable and throw those 
who engaged in fraud in jail where they belong. That is what the Fraud 
Enforcement and Recovery Act is all about. It is imperative we pass 
this bill as soon as possible.
  Under President Bush, the Federal Government basically turned a blind 
eye to white-collar crime. After September 11, about 100 FBI white-
collar fraud investigators had their job responsibilities shifted to 
focus on terrorism, which is understandable. But the problem is, they 
were never replaced to do and continue the work on white-collar crime. 
As a result, literally thousands of allegations of financial and 
mortgage fraud are going unexamined this day.
  Chairman Leahy's bill will turn this abysmal situation around by 
providing the resources necessary for the FBI to hire 160 additional 
special agents and more than 200 professional staff and forensic 
analysts dedicated to investigating white-collar crime.
  This bill also provides the resources necessary for the Justice 
Department to add up to 200 prosecutors and civil enforcement attorneys 
nationwide, as well as 100 support staff to focus on fighting fraud. 
This bill provides the resources necessary for the U.S. Postal 
Inspection Service, the U.S. Secret Service, and the inspector general 
at HUD to hire several hundred additional fraud agents, analysts, and 
investigators to combat fraud.
  This bill is desperately needed. It is important that we take a very 
aggressive look at the fraud that is going on in that area. I hope very 
much that all our colleagues will support this legislation
  With regard to this issue of what has been going on on Wall Street, 
there is no question but that the American people are furious--and 
rightly so. The American people want answers. What I wish to do now is 
say a word above and beyond this legislation, some of the areas that I 
think we have to go after we pass this bill. I think the American 
people are demanding an investigation to understand how we got into 
this financial crisis in the first place. Who are those people 
responsible? Some people say: Well, it is all of us. We are all 
responsible for this financial crisis. That simply is not accurate. The 
truth of the matter is, there are probably a few hundred people who, 
through their greed, their recklessness, their illegal behavior, have 
pulled our Nation and much of the world into a deep recession.
  We need to know who they are. We need to know what they did. We need 
to make sure this never happens again. And where illegal activity has 
taken place, we need to hold them accountable.
  One other area I wished to touch on, to look at another issue that is 
of concern to people in the State of Vermont--and I get e-mails on this 
virtually every day, I know it is true nationwide--at the same time as 
we are bailing out huge Wall Street financial institutions, at the same 
time as these financial institutions are getting zero interest loans 
from the Fed, you know what they are saying to the American people. 
They are saying: Thanks,

[[Page S4542]]

chump. We appreciate all your help. Now we are going to charge you 20, 
25, 30 percent interest rates on the credit cards we gave you.
  Recently, I have been receiving many e-mails from people who have 
seen the Bank of America, for no particular reason, doubling their 
interest rates all over this country. People are using their credit 
cards to pay for their groceries, to pay for basic needs. College kids, 
they are using credit cards to pay college expenses, and they are being 
charged outrageous rates.
  The reality is, today in America, if you can believe it, one-third of 
all credit card holders in this country are paying interest rates above 
20 percent, and as high as 41 percent, which is more than double what 
they paid in interest in 1990.
  What we are looking at right here is a situation in which the 
American people are bailing out these large institutions and in return 
what we get are outrageously high interest rates. I have introduced, 
along with Senators Durbin, Levin, Leahy, Harkin, and Whitehouse, 
legislation that will require any lender in this country to immediately 
cap all interest rates on consumer loans at 15 percent, including 
credit cards.
  The reason we have selected that number is, it is precisely what 
credit unions all over the country are operating under and have 
operated under for 30 years, and they have done well. They are not 
coming to Washington for hundreds of billions of dollars in bailouts.
  I think if it has worked well for the credit unions, it can work well 
for financial institutions. I hope we can get that bill on the floor 
and see it pass to protect millions of credit card holders all over 
this country.
  There is another issue I think we have to address. The reason 
Congress has provided $700 billion to bail out Wall Street, against my 
vote I should say but that is what happened, the reason the Fed has 
lent out over $2 trillion to large financial institutions has a lot to 
do with the phenomenon of ``too big to fail.''
  The thought is, if a large financial institution goes under, it will 
bring systemic damage to our entire economy, and it has to be propped 
up. As I said on the floor of this Senate more than once, if an 
institution is too big to fail, it is too big to exist.
  I will be introducing legislation soon to require that the Federal 
banking regulators examine every bank in this country to make sure no 
bank is too big to fail over a reasonable period of time. In other 
words, I think we have to take a look at what Teddy Roosevelt did 100 
years ago, over 100 years ago. If an institution is too big to fail, 
let's start breaking them up right now so we do not find ourselves back 
in the same place some years from now.
  It goes without saying, in another area, we have clearly got to end 
the deregulation of banking laws that were passed over the last decade 
that helped cause this crisis. There was a belief that if we let Wall 
Street do all the wonderful things they are capable of doing, well, 
they are going to provide and create prosperity, not only for their 
people but all over our country.
  Clearly, we have learned a lesson: When you leave Wall Street alone, 
they will do what they do best; that is, act in a very greedy way to 
maximize their profits. For them, 20 percent, 30 percent were not 
enough. They needed 40 percent, they needed 50 percent rates of return. 
Their CEOs needed not $20 million, not $50 million, in some cases they 
needed $1 billion.
  I think it is now widely understood that we have to reverse the 
deregulation that took place over the last decade, and we have to move 
forward with sensible regulation. That means we have to revisit 
certainly Gramm-Leach-Bliley, we have to restore the firewalls that 
were imposed by the Glass-Steagall Act in 1934 and that were repealed 
as a result of deregulation.
  On another issue, I think there is growing concern that the Federal 
Reserve has taken on new responsibilities and that there is a clear 
lack of transparency in the Fed. The American people have a right to 
know what is going on there, and today we are kept in the dark.
  Regardless of one's views on the merits of the $700 billion financial 
rescue package that was signed into law by President Bush on October 3, 
one thing we can say is that if the taxpayers and the citizens of this 
country want to know who received this money, all they have to do is go 
to a Web site and they can find that.
  On the other hand, if you want to know who received $2.2 trillion 
from the Fed, if you want to know what the terms are of those 
agreements, you will not find any information whatsoever. All of that 
information has been kept secret from the American people.
  I am grateful that as part of the budget debate, the Senate voted 59 
to 39 in favor of an amendment I offered to the budget resolution with 
Senators Bunning, Webb, and Feingold, calling on the Fed to release 
this information. In my view, it is time for the Fed to listen to the 
will of the Senate and the American people and release this information 
as soon as possible.
  Let me conclude by simply saying I think today we are debating a very 
important piece of legislation, the Fraud Enforcement and Recovery Act, 
introduced by my colleague from Vermont. This is an extremely important 
legislation. Let's get it passed as soon as possible with as large a 
vote as we can.
  After we do that, let's start turning our attention to other aspects 
of this Wall Street crisis so we can respond to the frustration and the 
anger of the American people, create a new Wall Street, create 
accountability, lower interest rates, and do many of the things the 
American people want to us to do.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Vermont.
  Mr. LEAHY. Mr. President, I have been in discussions with the 
distinguished Republican deputy leader, Senator Kyl. We do not have a 
formal agreement but what we are looking toward doing, in the next 10 
minutes or so, is having acceptance of the managers' technical 
amendment and then going to a rollcall vote on Senator Kyl's amendment, 
which I will support.
  I suggest the absence of a quorum.
  The ACTING PRESIDENT pro tempore. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. LEAHY. I ask unanimous consent that the order for the quorum call 
be rescinded.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.


                     Amendment No. 993, As Modified

  Mr. LEAHY. Mr. President, I ask unanimous consent to modify the 
Leahy-Grassley amendment at the request of the Justice Department to 
add the word ``or'' after the comma at page 2, line 1. I send the 
modification to the desk.
  The ACTING PRESIDENT pro tempore. The Senator has that right. The 
amendment is so modified.
  The amendment, as modified, is as follows:

       On page 15, strike beginning with line 20 through page 16, 
     line 10, and insert the following:
       (d) Major Fraud Against the Government Amended to Include 
     Economic Relief and Troubled Asset Relief Program Funds.--
     Section 1031(a) of title 18, United States Code, is amended 
     by--
       (1) inserting after ``or promises, in'' the following: 
     ``any grant, contract, subcontract, subsidy, loan, guarantee, 
     insurance or other form of Federal assistance, including 
     through the Troubled Assets Relief Program, an economic 
     stimulus, recovery or rescue plan provided by the Government, 
     or the Government's purchase of any troubled asset as defined 
     in the Emergency Economic Stabilization Act of 2008, or in'';
       (2) striking ``the contract, subcontract'' and inserting 
     ``such grant, contract, subcontract, subsidy, loan, 
     guarantee, insurance or other form of Federal assistance,''; 
     and
       (3) striking ``for such property or services''.

  The ACTING PRESIDENT pro tempore. The Senator from Oklahoma.
  Mr. COBURN. I ask unanimous consent to be recognized until Senator 
Kyl returns to the floor or for a shorter period of time, whichever may 
be the shortest.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Mr. COBURN. Mr. President, nobody disputes the intent that we ought 
to go after the fraud that has been associated with the mortgage 
industry and some of the problems thereof. We passed the stimulus bill 
that had a lot of money for the Justice Department in it. We didn't 
tell them they should

[[Page S4543]]

use the money on this. We passed an omnibus bill, none of which did we 
put money in. We put $10 million in for the FBI. Now we come before the 
Senate wanting to authorize $500 million more for a bill in a 
department, the Justice Department, that will end this fiscal year with 
over $2 billion in the bank. Since I have been a Senator, they have had 
over $2 billion at the end of the year. There is something unique about 
the Justice Department. The Justice Department is the only Federal 
agency that doesn't ultimately have to send its unspent money back to 
the Treasury. They get to keep it.
  In a time where we are spending money to the tune of $112 billion a 
day every day we have been in session so far in this 111th Congress, to 
say that we ought to send another $500 million to an agency that is 
going to have $2 billion left over at the end of this year and the next 
few years to come tells us we are not good money managers, but most of 
the American people know that already.
  On fiscal grounds, what we are doing is, we are authorizing money. 
And that is what will be the response to this debate: It is just an 
authorization. The fact is, if you are authorizing, you intend to spend 
it. You are going to try to get another $500 million appropriated on 
this bill.
  Secondly, we don't have ex post facto laws. So everything this bill 
does has no application in terms of a statute change to any of the 
crimes committed, either the fraud or money laundering or anything 
else. It has no application. None of it will apply to misdeeds and 
infractions of the law that happened that got us into this crisis.
  Additionally, every act that was committed that broke a law under the 
statutes we have today, both Federal mail fraud and wire fraud, can be 
prosecuted already. What is going on? What is going on is, we are going 
to pass a bill in reaction to a problem that Congress created in the 
first place by incentivizing poor behavior at Fannie Mae and Freddie 
Mac, by not doing oversight, and we are going to make everybody feel 
better because we reacted to it. We don't need new laws on the books. 
What we need to do is enforce the laws we have today. It may be true 
that the Justice Department might need additional moneys. But where is 
the oversight?
  We released a report earlier this year that showed $10 billion over 
the last 5 years of waste in the Justice Department. Here is a 
department that has wasted $10 billion over the last 5 years, has $2 
billion at the end of this year with which they could fund this. We 
didn't fund any of it except $10 million in the stimulus bill or the 
omnibus bill, and we are adding new laws to the books that we don't 
need to prosecute the people who broke the law. It is a typical 
congressional reaction when what we should be doing is enforcing the 
laws already on the books and supplying on a priority basis the funding 
for the Justice Department to prosecute that.
  I see Senator Kyl is here. I will continue my comments later.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Vermont.
  Mr. LEAHY. Mr. President, we have the Leahy-Grassley technical 
amendment. I ask for its passage.
  The ACTING PRESIDENT pro tempore. Is there further debate on the 
pending amendment?
  Hearing no further debate, without objection, the amendment, as 
modified, is agreed to.
  The amendment (No. 993), as modified, was agreed to.
  Mr. LEAHY. Mr. President, I move to reconsider the vote.
  Mr. KYL. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                           Amendment No. 985

  Mr. LEAHY. I believe it would be in order now to bring up the Kyl 
amendment; is that correct?
  The ACTING PRESIDENT pro tempore. That is the pending amendment.
  Mr. LEAHY. I ask for the yeas and nays on the Kyl amendment.
  The ACTING PRESIDENT pro tempore. Is there a sufficient second?
  There appears to be a sufficient second.
  The yeas and nays were ordered.
  The ACTING PRESIDENT pro tempore. The Senator from Arizona.
  Mr. KYL. Mr. President, I will describe this amendment in one 
sentence so as not to be more confusing than it otherwise would be. It 
is clearly a technical amendment and has strong support on both sides. 
It modifies the bill's definition of the term ``obligation'' as used in 
the reverse False Claims Act to exclude contingent obligations, thus 
precluding the possibility that conduct that makes a defendant liable 
for a penalty or a fine could become actionable under this law before 
that fine is actually established or assessed. I believe the amendment 
is agreed to on both sides.
  The ACTING PRESIDENT pro tempore. The Senator from Vermont.
  Mr. LEAHY. Mr. President, I thank the Senator from Arizona. He worked 
with me and Senator Grassley. We both support his amendment. I will 
vote for it.
  The ACTING PRESIDENT pro tempore. If there is no further debate on 
the amendment, the question is on agreeing to amendment No. 985.
  The yeas and nays are ordered.
  The clerk will call the roll.
  The legislative clerk called the roll.
  Mr. DURBIN. I announce that the Senator from Massachusetts (Mr. 
Kennedy), the Senator from Massachusetts (Mr. Kerry), and the Senator 
from West Virginia (Mr. Rockefeller) are necessarily absent.
  Mr. KYL. The following Senator is necessarily absent: the Senator 
from Kansas (Mr. Roberts).
  The ACTING PRESIDENT pro tempore. Are there any other Senators in the 
Chamber desiring to vote?
  The result was announced--yeas 94, nays 1, as follows:

                      [Rollcall Vote No. 160 Leg.]

                                YEAS--94

     Akaka
     Alexander
     Barrasso
     Baucus
     Bayh
     Begich
     Bennet
     Bennett
     Bingaman
     Bond
     Boxer
     Brown
     Brownback
     Bunning
     Burr
     Burris
     Byrd
     Cantwell
     Cardin
     Carper
     Casey
     Chambliss
     Coburn
     Cochran
     Collins
     Conrad
     Corker
     Cornyn
     Crapo
     DeMint
     Dodd
     Dorgan
     Durbin
     Ensign
     Enzi
     Feingold
     Feinstein
     Gillibrand
     Graham
     Grassley
     Gregg
     Hagan
     Harkin
     Hatch
     Hutchison
     Inhofe
     Inouye
     Isakson
     Johanns
     Johnson
     Kaufman
     Klobuchar
     Kohl
     Kyl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Lugar
     Martinez
     McCain
     McCaskill
     McConnell
     Menendez
     Merkley
     Mikulski
     Murkowski
     Murray
     Nelson (NE)
     Nelson (FL)
     Pryor
     Reed
     Reid
     Risch
     Schumer
     Sessions
     Shaheen
     Shelby
     Snowe
     Specter
     Stabenow
     Tester
     Thune
     Udall (CO)
     Udall (NM)
     Vitter
     Voinovich
     Warner
     Webb
     Whitehouse
     Wicker
     Wyden

                                NAYS--1

       
     Sanders
       

                             NOT VOTING--4

     Kennedy
     Kerry
     Roberts
     Rockefeller
  The amendment (No. 985) was agreed to.


                           Amendment No. 995

(Purpose: To establish the Financial Markets Commission, and for other 
                               purposes)

  The ACTING PRESIDENT pro tempore. The Senator from Georgia is 
recognized.
  Mr. ISAKSON. Mr. President, I ask unanimous consent that the pending 
amendment be set aside and the clerk call up amendment No. 995.
  The ACTING PRESIDENT pro tempore. Is there objection? Without 
objection, it is so ordered.
  The clerk will report.
  The legislative clerk read as follows:

       The Senator from Georgia [Mr. Isakson] proposes an 
     amendment numbered 995.

  (The amendment is printed in today's Record under ``Text of 
Amendments.'')
  Mr. ISAKSON. Mr. President, I ask unanimous consent to speak for 5 
minutes.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Mr. ISAKSON. Mr. President, I am honored to be introducing this 
amendment today on this piece of legislation. I am particularly pleased 
to have worked for the past 3\1/2\ months with the Senator from North 
Dakota, Mr. Conrad, who is the principal cosponsor on what is known as 
the Financial Markets Commission.
  In the last year, the people of the United States have seen the value 
of their homes decline, the value of their

[[Page S4544]]

529 savings accounts for their kids' college decline, their mutual 
funds, and their investments in whatever category. Declines that 
started out to be a hiccup became colossal and we now find ourselves in 
a position where we are deleveraging and we are deflating in the United 
States of America.
  There should be some answers. Quite frankly, there is plenty of blame 
to go around, but we need some answers. We need some guidance. We need 
to ensure that my grandchildren and my children and yours don't ever go 
through the experiences we have gone through and we have shared with 
the American people in the last 12 months.
  The only way to get an objective evaluation of what went wrong and 
where mistakes were made is to create an independent commission of 
recognized people of experience to look into the financial markets, the 
rating agencies, Freddie Mac, Fannie Mae, investment bankers, hedge 
fund operators, commodities traders--everybody--and FASB and say: What 
went right, what went wrong, and what could we have done better to have 
prevented this from going on?
  I have a lot of suggestions. I could drop a lot of bills right now, 
including transparency for hedge funds and changing who compensates the 
rating agencies from the seller securities to the buyer securities. But 
we need a forensic audit of the laws of the United States as it relates 
to the financial markets, the Federal Reserve, and every aspect, so 
whatever did go wrong that could have been avoided is avoided.
  This Commission is designed to operate for 18 months. It has a budget 
of $5 million and subpoena powers and it is directed to report back to 
the Congress of the United States its findings. It is specific in every 
regard so that anybody who could have been a part of what happened in 
this financial collapse is subject to investigation, is subject to 
scrutiny, and is subject to the sunshine that is necessary to get 
answers.
  I think we owe it to the American people. I know I owe it to my 
children and grandchildren and to those people who voted for me to find 
out what went wrong and try and make it right.
  Senator Conrad has been diligent in his effort to help. He has made 
very constructive suggestions concerning the amendments to this 
legislation. Jointly with him, we worked with the Banking Committee 
members, the ranking member, and the chairman to try to incorporate the 
ideas of everyone and to make sure we don't miss the mark, that we stay 
on focus, and we get what the American people deserve; that is, answers 
to what caused the financial collapse that has decreased the value of 
their homes, the value of their savings accounts, protracted their 
retirement, and brought about the uncertainty that we have today in the 
economy of the United States of America.
  With that, I thank the Senator from North Dakota for his help. I 
thank the chairman and ranking member of the Banking Committee.
  I yield the floor.
  The PRESIDING OFFICER (Mr. Merkley). The Senator from North Dakota is 
recognized.
  Mr. CONRAD. I thank Senator Isakson for his leadership in this 
matter. It has been exemplary. I have truly enjoyed working with 
Senator Isakson and his staff. They are the leads on this legislation, 
which I think is one of the more important pieces of legislation we 
will consider this year.
  We have had two extraordinary tragedies in this country in the last 
period of time: September 11, when this country was attacked, and also 
what was very close, I believe, to a global financial meltdown. In 
fact, I will never forget as long as I live when, last fall, being 
called to a special urgent meeting in the leader's office with the 
chairman of the Federal Reserve and the Secretary of the Treasury of 
the previous administration and being told they were going to take over 
AIG the next day and they believed if they did not do it, we could 
suffer irreparable damage to the economy of the United States and, in 
fact, we could face a global economic meltdown.
  After 9/11, we put into place a commission--bipartisan, nonpartisan--
to review what happened, why it happened, and what could be done to 
prevent it from ever happening again.
  That is precisely what we must do now with respect to the economic 
crisis that is upon us. We have an obligation to the people of this 
country and to our colleagues to put into place a commission, which is 
separate from partisan politics, to do a careful review of what 
happened, why it happened, and how it could be avoided from ever 
happening again.
  All across America, millions of people are wondering about their 
retirement. They are wondering if they will be able to retire. They are 
wondering what the quality of their life is going to be in retirement. 
They are wondering how their 401(k) became a 201(k). How did their 
retirement savings get cut in half? What occurred and who is 
responsible and what could be done to prevent it from happening again?
  This Commission will have 10 members appointed by the majority and 
minority leaders of the Senate, the speaker and minority leader in the 
House of Representatives, the chairman and ranking members of the 
Senate Banking Committee and the House Financial Services Committee. It 
will be charged with reporting back to the President, the Congress, and 
the American people by the end of next year. The Commission will also 
have the authority to refer evidence of criminal wrongdoing to the 
Justice Department and State attorneys general for prosecution.
  I believe this Commission is absolutely essential to determine, in a 
nonpartisan way, how this financial crisis occurred. Where were the 
mistakes made? Were there failures of regulation? Were there failures 
in the regulatory agencies? Were there failures in the private sector?
  I think we all know the answer to every one of those questions is 
yes. There were failures in the Congress of the United States and in 
the administration. This is not a finger-pointing exercise; this is an 
exercise to determine, on a fair and objective basis, what occurred and 
what can be done to prevent it from happening again. That is the goal 
of the legislation introduced by Senator Isakson, which I am proud to 
cosponsor.
  Let me conclude by saying that working with Senator Isakson has been 
a delight. He is a fairminded, serious legislator who has spent an 
enormous amount of time doing this legislation--and, let me say, doing 
it right, talking directly to the committees of jurisdiction, trying to 
get their input, their assessment, and also talking to other colleagues 
and preparing something that I think is fair, balanced, and is 
completely intended to be objective in its outcome.
  I think all of us have a responsibility to see this through to the 
end, so that at some future date the American people will be able to 
look back and find out, on an objective basis, what were the failures 
of fiscal policy, what were the failures of monetary policy, what were 
the failures of the private sector, what were the failures of 
Government regulation and the policymakers in the Congress of the 
United States and in the administration? What could be done to prevent 
it from ever happening again? We have that obligation to the American 
people.
  Again, I thank Senator Isakson for his leadership on this important 
matter.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Vermont is recognized.
  Mr. LEAHY. Mr. President, I have listened to some of the things being 
said. I agree with the distinguished Senator from Georgia, who said we 
should find out what went wrong and try to make it right. The 
distinguished Senator from North Dakota said we should find out what 
happened and why it happened and make sure it never happens again. And 
it should be a nonpartisan effort, not finger pointing.
  I find myself closely aligned with this. I said the same thing about 
having an accountability commission on what happened in areas including 
torture, the OLC memos that twisted statutes and policy, and with White 
House interference in prosecutions and law enforcement. And I have been 
making such a recommendation for some time, so that we can find out 
just what happened. As we now found, opinions were written that were 
totally contrary to the law. We find such things as the Bybee memo. I 
hope that Judge Bybee, now that that memo has become public, will do 
the honest thing, the moral thing, the right thing, and resign from

[[Page S4545]]

the bench. We find out about more and more of these alarming issues, 
but we still do not have all the facts.
  I think we should have some type of a nonpartisan commission, as the 
Senator said--not for finger-pointing, as he said--but to find out what 
happened and why it happened and to make sure it never happens again. 
We must find out what happened in order to try to make it right, as the 
Senator has also said.
  I am tempted to offer, as a second-degree amendment to this one, an 
amendment to include an examination of everything that went on during 
the last administration with regard to the manipulation of prosecutors, 
the manipulation of the law, and those who wrote memos saying basically 
that certain people in the Government are above the law, cannot be 
affected by the law, and cannot be held accountable to the law. Those 
individuals even went so far as to say that the President could simply 
decide the law does not apply to him, which, of course, would be the 
first time in this Nation's history that any binding Executive branch 
memo has ever claimed a President has that authority that I am aware 
of. All the arguments made by the Senator from North Dakota, which I 
believe were good arguments, could be made, for my commission proposal. 
On the question of why people decide not to follow our laws, how they 
convinced themselves to do that, and how they managed to get lawyers to 
write twisted memos to justify the idea that they did not have to 
follow the law: we had a certain cadre of such people within the White 
House and within the administration. And they apparently believed they 
could automatically excuse themselves from following the law.
  As I have said, there is the temptation to offer this as a second-
degree amendment. I will not. But I simply point out that if it is 
applicable here, it is certainly applicable in those areas where people 
were not just trying to steal money, they were trying to steal the 
Constitution of the United States. And they are trying to steal the 
laws of the United States. I think that should be looked into just as 
much as somebody who might want to steal money from the United States. 
Money can be paid back and should be paid back. Once you lose honor, 
once you lose your integrity, once you lose credibility, once you lose 
adherence to our Constitution, that takes a lot longer to get back.
  Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. GRASSLEY. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. GRASSLEY. I will speak on a provisions of the bill dealing with 
money laundering. This section of the bill that I am referring to would 
amend the criminal money laundering statute to make clear that the 
proceeds of specified unlawful activity include the gross receipts of 
illegal activity and not just the profits of that illegal activity.
  The money laundering statutes make it an offense to conduct financial 
transactions involving the ``proceeds'' of a crime, sometimes referred 
to as ``specific unlawful activity'' in the statutes.
  These statutes, however, do not define what the term ``proceeds'' 
amounts to. Instead, the term has been left to definition by our 
courts.
  For 22 years, since the money laundering statute was enacted in 1986, 
courts have construed ``proceeds'' to mean ``gross receipts'' and not 
``net profits'' of illegal activities consistent with the original 
intent of Congress.
  However, last year, the Supreme Court entered into it and, of course, 
reverses the definition in a case called United States v. Santos.
  The Supreme Court suggested that the term ``proceeds'' was 
``ambiguous''--that is their word--and as a result, under the rule of 
lenity, the Court gave the term a much narrower definition.
  In this decision, the Court mistakenly limited the term ``proceeds'' 
to the ``profits'' of a crime, not the more global word ``receipts.''
  As a result, the Court's decision has limited the money laundering 
statutes to only profitable crimes. It gives criminal defendants an 
argument against their criminal conduct by forcing the Government to 
prove that they actually made a profit, regardless of the criminal 
activity.
  This decision of the Court is contrary to the intent of Congress in 
passing the money laundering statutes and weakens one of the Federal 
Government's primary tools used to recover the proceeds of illegal 
activity, including mortgages and securities fraud.
  For example, these are some of the problems created by the Santos 
decision.
  If a drug dealer committed a financial transaction with the proceeds 
of illegal drug dealing but the money was only used to purchase drugs, 
then they could not be prosecuted for money laundering. I know, 
everybody hears that, and they say common sense dictates otherwise. But 
the Supreme Court interpretation puts us in that sense that is contrary 
to common opinion.
  Another example: If a fraudulent broker, such as a mortgage broker, 
intentionally overvalued the fair market of a home for purposes of a 
mortgage, that broker could only be charged for money laundering 
related to any fees or potential profit made in the fraudulent 
transaction, not based on the full value of the house.
  Another example: An executive who committed security fraud could not 
be charged with money laundering if the fraud were unsuccessful in 
making a profit even though there was a fully completed financial 
transaction.
  Those are just three of many examples I could give about how Santos 
very narrowly construes the possible prosecution and limits the 
prosecution of certain unlawful activity in the area of money 
laundering.
  This legislation corrects the Santos decision and moves us forward so 
that profit or not, there is money laundering actually going on, we 
will have an opportunity to prosecute and hopefully succeed in the 
prosecution.
  I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. DORGAN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DORGAN. Mr. President, I will in a period of time offer an 
amendment with my colleague, Senator McCain, dealing with a select 
committee of the Senate. We are waiting for Senator Dodd, and as soon 
as Senator Dodd arrives I will relinquish the floor so he might 
proceed.
  As we are waiting, I wish to commend my colleagues, Senator Isakson 
and Senator Conrad, on the legislation they have introduced dealing 
with a commission. The formulation of a commission seems to me to make 
some sense.
  I offered something called the Taxpayer Protection Act in late 
January of this year. One of the five provisions of that act called for 
the creation of such a commission. Frankly, Senator Isakson and Senator 
Conrad have substantially improved on that idea. Their amendment is 
very well done. It is something I very strongly support and I think 
will advance the interests of the Congress and the American people in 
trying to understand what exactly has happened here.
  I do want to mention that the amendment I will offer following a 
discussion in a few minutes by Senator Dodd will be an amendment that 
relates to S. Res. 62, a Senate resolution Senator McCain and I jointly 
submitted about 2 months ago calling for the creation of a select 
committee to investigate, through the use of subpoenas and other 
approaches, the narrative of what has happened. While I think a 
commission is valuable in making recommendations, having some of the 
best minds around the country serving on an independent commission, I 
also believe there is a responsibility in the Senate for a select 
committee of the type that has existed in history on a number of 
occasions to do the work to understand what is the master narrative 
here, what has happened to cause this unbelievable financial crisis. I 
will talk more about the

[[Page S4546]]

issue and the need for the establishment of a select committee when I 
introduce the amendment, but for the moment I wanted to say a couple of 
things.

  One, I believe this issue of a commission that my colleagues have 
advanced is something very worth supporting. Both my colleagues, 
Senator Isakson and Senator Conrad, have done a lot of work on this, 
and it is very good work and it deserves, in my judgment, our support.
  I also want to say, in the context of these discussions, that before 
our colleague, Senator Dodd, who is coming to the floor in a bit, and 
who is chairman of the Senate Banking Committee, now lies the task of 
trying to put together the pieces of this puzzle and to find out how 
all of this works. He has done an enormous number of hearings. What 
Senator Dodd is doing in these hearings in the committee and under his 
leadership is trying to figure out how do you lift this country out of 
the ditch? How do you put this system back together? How do you fix 
what is wrong in this banking system? How do you put the pieces 
together so they fit and represent the public interest so this doesn't 
happen again?
  Senator Dodd has done so many hearings on this in the recent months. 
Very few Members of the Senate, I think, understand the hours it has 
taken Senators Dodd and Shelby, leading that committee. But I must say 
again, they are forward looking to try to figure it all out. This 
country is in a huge hole. We have a banking system in chaos. We have a 
financial crisis. How do you get out of this hole? How do you lift this 
country? How do you put the pieces back together? How do you fix what 
is wrong in order to make it right so we can provide for recovery in 
this country?
  I want to say again that our colleague, Senator Dodd, and let me also 
say the ranking member of that committee, has an enormous burden. Under 
Senator Dodd's leadership, I think they have done an extraordinary job 
and they are at that work even today as I speak.
  As we talk here on the floor about these issues, I don't want anybody 
to misunderstand the responsibilities of the committee and what that 
committee is trying to do. I don't serve on that committee, but we have 
some awfully good Senators who do--Republicans and Democrats--and we 
have a good chairman--who are all trying to figure out how you put this 
together going forward.
  You know, this country has not seen this kind of financial collapse 
for a long time--the first time in my lifetime, certainly. It is a 
collapse of the sort that harkens back to the Great Depression. And the 
question isn't whether this country will recover--it will. This is a 
great country, very resourceful, and full of great people who want to 
lift this country up. We need to do that work together. The question 
isn't whether; the question is when and how we will effect this 
recovery. And that is part of what all of us are grappling with, most 
notably, of course, the Senate Banking Committee. The discussions that 
are underway this afternoon are discussions about a commission, a 
committee, and so on. They are very important.
  Let me make one other point. The legislation that is the subject of 
amendment is legislation brought to us on a bipartisan basis by Senator 
Leahy and Senator Grassley and others. That is a piece of legislation 
that is very important as well, and I will speak more about that at 
some later point. But the underlying legislation is another piece of 
trying to grapple with something that should never have happened but 
now must be fixed. They are talking about providing the resources 
necessary for the investigators, for the prosecutors, for the law 
enforcement functions that need to be exercised here to find 
accountability--who did what. We don't know.
  It is interesting, there are a lot of things that have caused us 
problems and that steered this country into a financial ditch--a lot of 
them. Debt, deregulation, and dark money are just three, and I could 
describe all of them at great length. But our colleagues, Senator Leahy 
and Senator Grassley and others, on a bipartisan basis, are bringing 
something to the floor that says let us have the resources to go after 
some of these kinds of practices.
  Let me show you something. I went to the Internet today. This is on 
the Internet today. This is an advertisement: You want to get a loan? 
These folks want to give you a loan. It is called speedy bad credit 
loans. Isn't that unbelievable? With all this country has faced, you 
can go to a company called speedybadcreditloans.com. You have bad 
credit? They say that is okay. You have no credit? Well, that is OK 
too. If you have been bankrupt, that is no problem. Come to us, we will 
give you some money. These are the same shysters who have been involved 
in this and who ran this country into the ditch.
  I was wondering if I should spell that word. Maybe I shouldn't have 
used the word, but the fact is it is the same kind of folks who ran 
this country into the ditch in the first place by putting out subprime 
mortgages and saying: If you have bad credit, come to us. No credit, 
slow pay, no pay? Come to us. Doesn't matter. We want to give you some 
money. It is unbelievable to me.
  So here on the Internet today--bad credit mortgage, no credit, bad 
credit, bankruptcy, no downpayments, no delays. You certainly don't 
need delays if you don't have a good credit rating. You want to get 
some money from somebody? By the way, these folks are making a fortune. 
They put money out there on the street and then they would securitize 
it, pass the risk on up, and everybody was making a bunch of money.
  My colleagues, Senators Leahy and Grassley and others, are saying: 
You know what, the resources needed to go after these kinds of people 
and prosecute this bad behavior and hold people accountable, those 
resources need to be passed by this Congress. And I agree with that.
  Here is another on the Internet today. CC&G Financial Group working 
together to build your dreams. Bad credit? Poor credit? We can get you 
in your dream home. In fact, we will finance the current home that you 
have. Isn't that something? CC&G Financial Group says, you have bad 
credit? You have poor credit? Hey, we have a deal for you. Borrow some 
money from us.
  Let me tell you the little trick these folks have been doing. They 
put you into a mortgage with a teaser loan. They say: You know what, 
you are paying way too much on your monthly payment. We will give you a 
loan with a 2-percent interest rate. We can cut that monthly payment by 
hundreds and hundreds of dollars a month. Oh, they don't tell you that 
it will reset; and yes, that 2-percent interest rate that gets that 
payment way down in about 2 or 3 years will reset to 10 percent or 12 
percent, and then you won't be able to afford to make the payment. And 
by the way, we will lock in something called a prepayment penalty--
which you will never hear about. It means you can never repay it.
  Now, why do they do that? So they could pack these up like sausages. 
They used to pack sawdust in sausages for filler. They would pack them 
up like sausages with sawdust, and then slice them and dice them and 
sell them as securitized loans. And they say to these hedge funds, 
investment banks, and others that wanted to buy all this nonsense, all 
this investment trash, they would say, we have a good deal for you. We 
have a bunch of loans in here with prepayment penalties, so they can't 
get out of it, and by the way, the yield is good. All these smart 
people in the room didn't understand that nobody was going to be able 
to repay those loans.
  They also say: Do you want a loan with no documentation of your 
income? It is called a no doc. No documentation. We will give you a 
loan on your home and you don't even have to document your income. We 
don't care. No doc. You want a loan you don't have to pay any principal 
on, just the interest? If that is not good enough, you can't pay the 
interest even? We will do this for you. You don't have to pay any 
principal, or all the interest. We will wrap it around the back side of 
the mortgage. Or even better, we don't have to document your income, 
you don't have to pay any principal, any interest, and we will make the 
first 12 payments for you.
  That is how lucrative this business was. You got bad credit, can't 
pay your bills, are you a bad risk? Come to us. The biggest mortgage 
company in the country--Countrywide Mortgage--here

[[Page S4547]]

is what they said--the biggest mortgage company in the country. And by 
the way, they went belly up, and the folks at the top of that company 
went home with hundreds of millions of dollars--hundreds of millions of 
dollars. Here is what the biggest mortgage company in the country said 
in the middle of all this. They said: Do you have less than perfect 
credit? Do you have late mortgage payments? Have you been denied by 
other lenders? Call us. We consider you a buddy, because we can make a 
bunch of money off of you.
  Well, Mr. President, I will discuss more about this later. I have 
been waiting for my colleague from Connecticut, who I indicated was on 
his way, and I wish to yield the floor now, and following my 
colleague's presentation, at that point I wish to offer an amendment 
with my colleague from Arizona.
  The PRESIDING OFFICER. The Senator from Arizona.
  Mr. McCAIN. Mr. President, I see my colleague from Connecticut is 
waiting, so I will be brief. There is not much I can add to the words 
of my friend and colleague Senator Dorgan of North Dakota, whom I have 
had the privilege of working with in the past on a number of issues, 
especially the investigation of a scandal that is still ongoing, as a 
matter of fact, concerning Mr. Abramoff and his corrupting effect on 
both sides of the aisle.
  All of us just came back from a recess. All of us had an extended 
opportunity to visit with our constituents. In Arizona, I had that 
opportunity. Traveling around my State, I saw that there is confusion, 
there is frustration, and there is justified anger. People are not able 
to stay in their homes, and they are unable to keep their jobs, with 
unemployment continuing to go up. A State such as mine was hurt very 
badly because we were on the crest of the wave of the housing and the 
crashdown in the most dramatic fashion. So I understand and appreciate 
and sympathize with the fear and anger and frustration people feel 
about what is going on in America's economy today, and they want 
answers.
  Actually, they want two things: They want answers and they want 
relief. But they also want to know what are we going to do to prevent a 
crisis of this nature from ever happening again. So far we haven't 
given them any real good answers. That is why the proposal of Senator 
Dorgan, which I am pleased to join in, is so important at this time. 
The American people deserve to know what caused this crash, what caused 
this catastrophe which caused them to lose their homes, their families, 
their jobs, and futures.
  A select committee could get to work right away. We could be in 
business for a year. I have been on select committees before, including 
the one on POW and MIA issues. We were able to resolve the issue to a 
significant degree in a bipartisan fashion. I have no doubt this could 
be a bipartisan select committee. There have been select committees in 
the past and there may be select committees in the future, but this is 
vital to Americans now because they lack confidence in our economy 
today and in their future.
  Americans deserve to know what happened, to apportion 
responsibilities, and most importantly to know this will never befall 
them again. So I urge my colleagues to act and act quickly. We can talk 
about a commission. I have no objection to commissions. Some have been 
successful, some have not. The 9/11 Commission, which I was proud to 
sponsor, had magnificent results. The Commission on Social Security and 
Medicare disappeared like a stone.
  I understand there are various areas of jurisdiction. The 
distinguished chairman of the Judiciary Committee is here, the 
distinguished chairman of the Banking Committee is here, and I know 
they are working hard, and I know they are going into their areas of 
responsibility. But I would allege that these areas of examination 
include economic, financial, banking, housing, trade, and a broad range 
of issues which are not under the jurisdiction of a specific committee. 
I understand jurisdictional proprietorship. I also understand some 
people may view this as some kind of encroachment upon their 
responsibilities. But another thing about a select committee is that it 
gets the kind of attention that select committees get. I have been 
around the Congress long enough to see that when there is a crisis, 
select committees get the kind of attention and the kind of results 
that can lead to the kinds of reforms that are necessary.
  We are in the greatest economic crisis since the Great Depression. 
Everyone knows that. The American people deserve to know what happened, 
who caused it, and what we are going to do about it.
  It does not just lie under the jurisdiction of one committee. It 
crosses all lines, and it should be composed, frankly, of the most 
qualified people and staff we can come up with. So I urge my 
colleagues, in the interest not of specific committee jurisdiction but 
in the argument that this crisis, in its size and severity, is nearly 
unprecedented in American history and requires extraordinary actions. 
That is not business as usual.
  I urge my colleagues to set aside any partisan or jurisdictional 
differences and vote in favor of an immediate appointment of a select 
committee to immediately address this crisis which has affected the 
United States of America in the most painful fashion.
  I thank my colleague from North Dakota, who fits the best and finest 
and most admirable definition of a prairie populist. I thank him and I 
yield the floor.
  The PRESIDING OFFICER. The Senator from Vermont is recognized.
  Mr. LEAHY. Mr. President, on the particular matter, the distinguished 
Senator from Arizona and the distinguished Senator from North Dakota 
have spoken about the jurisdiction of the Judiciary Committee, and I 
assume the chairman of the Rules Committee will speak about it. I also 
understand that Senators Schumer and Coburn have amendments. I urge 
them to come to the floor because there has been a request for a vote 
on the Isakson-Conrad amendment. I will not make a unanimous consent 
request at the moment, but it is our intent to have a vote on that 
around 4:20, 4:30--on the Isakson-Conrad amendment.
  I understand, because of budget matters that come up tomorrow, there 
is an intent to try to finish this bill tonight. We can finish this 
bill tonight. I hope we could finish it before 6 or 7 or 8 o'clock. 
Having an Irish father and Italian mother, I come with a hopeful 
attitude by nature. But I note we will have a vote around 4:30, 4:20 or 
4:30.
  There are a number of matters. I see the distinguished and able 
chairman of the Banking Committee here. There are a number of matters 
within the jurisdiction of the Banking Committee. I will let him speak 
to that.
  I urge Senators who have amendments to bring them to the floor 
because as soon as we have no amendments apparently here, we are going 
to try to move to final passage.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Connecticut.
  Mr. DODD. Mr. President, let me, first of all, commend our colleague 
from Vermont for his work on the underlying subject matter, which is of 
great importance not only to the Senate but to the American people, to 
deal with issues of fraud and related matters. I think it is 
tremendously helpful.
  I was not on the floor. I apologize to my colleague from Georgia, 
Senator Isakson, and to Senator Conrad, with whom I have joined in 
offering their proposal to establish a commission to examine, as the 
Senator from Arizona has accurately pointed out, and the Senator from 
North Dakota pointed out, the most serious economic crisis in the last 
100 years of our Nation. This is a matter that not only deserves our 
attention, in terms of what steps we take as legislators to avoid the 
kind of problems we are witnessing today, but also, I think 
importantly, to look back as to how we ended up in this situation over 
the last several years.
  Going back, it all didn't begin a year ago or 2 years ago, but 
decisions that were made as many as 20 years ago--15, 10 years ago--had 
an awful lot to do with the problems that emerged, particularly in the 
area of residential mortgage foreclosures that became the root cause of 
the economic collapse.
  There is no debate about whether we ought to look back. At least I 
don't see any. I think it is critically important, as other Congresses 
at other moments in our Nation's history when confronted with other 
crises have done. Whether it was the great Civil War, the

[[Page S4548]]

sinking of the Titanic, the so-called Pecora Commission--which was 
named for the legal counsel of the Senate Banking Committee during the 
Great Depression, looking back, obviously, the 9/11 Commission. There 
is example after example. The only question that remains for us to 
decide here is what is the best way to do this.
  Senator Isakson, Senator Conrad, myself, and others who may join us, 
believe the outside commission is probably the best alternative, given 
the magnitude of the problem that must be examined. I think it will 
take a significant amount of hard work by some very talented and 
knowledgeable people over the next year, year and a half or so to do 
the job. Or do we engage in the same effort internally in this body 
with a select committee made up of Members of the Senate who would have 
to pretty much dedicate almost their entire time, in my view, to that 
subject matter at the very time we are trying to step forward with some 
answers that will provide some solutions as to how we avoid pitfalls.
  Obviously, we were not waiting in the Banking Committee. Senator 
Shelby and I, my very able and competent former chairman of the 
committee and today ranking member, have already had, I think, some 15 
or 16 hearings just since the end of January on the subject matter--the 
Presiding Officer is a distinguished member of our committee--on how we 
create the architecture to go forward and fill in the gaps so we don't 
end up with the same kind of problems that created the situation we are 
in. We cannot wait until the next Congress to do that. I believe it 
incumbent on us to come up with some answers to that in this Congress. 
We are working very hard on exactly that effort. There are some other 
matters we have to pay attention to, but that, I would argue, is the 
principal job of our committee in this the 111th Congress.
  I know other committees are deeply involved. The Finance Committee is 
deeply involved in health care. Senator Max Baucus and Senator Chuck 
Grassley are going to be spending virtually every waking hour over the 
next several months, along with Senator Kennedy and Senator Enzi, on 
the Health and Education, Labor, and Pensions Committee, not to mention 
others, dealing with that issue.
  We have the climate change issues. We have the budgetary matters. 
Senator Conrad and his committee, along with Judd Gregg from New 
Hampshire, are deeply involved in the budgetary questions.
  When you start talking about forming a select committee made up of 
Members of this body, some of the very people on the Finance Committee, 
the Banking Committee, the Budget Committee, are already consumed with 
major responsibilities. The likelihood that a group of ourselves here 
could dedicate the time and the effort that needs to be dedicated to 
the examination of this issue while simultaneously trying to get our 
economy back on its feet again, I think is asking an awful lot.
  My disagreement with my very good friend, and he knows this, my close 
friend from North Dakota, along with John McCain, with whom I have had 
a very good and positive relationship over the years, is not about 
whether we ought to do this--there is no debate about that--but where 
is the best venue for this to occur.
  Let me make a second argument to my colleagues. This has already been 
a pretty acrimonious debate regrettably, but it has turned into that. 
There was a lot of finger-pointing going on. None of us may like that 
individually, but it is what it is. I think to the extent we can ask 
the body, that is a political body in nature, to kind of do the job 
without engaging in some of that ``blame the other guy for the problems 
we have'' is unavoidable. I don't think any of us objectively believe 
that is a very good way to proceed. We are not going to get very much 
out of it if that becomes what happens in these select committees, 
making sure someone else gets responsibility for the difficulty. 
Believe me, there is a lot of responsibility to go around.

  But I believe if you end up having that kind of framework you are 
inviting that kind of environment and I think the last thing this body 
needs at this hour is to be seen as engaging in nothing more than the 
politics of the blame game.
  I argue, again, that an outside commission made up of people who are 
knowledgeable, coming from the world of finance, academia, labor, 
consumers, others, who could dedicate the time and effort along with a 
competent staff to work with them and reporting back to us, the 
committees that have jurisdiction, as they uncover evidence or ideas 
that would help us fill in these gaps that we need to do legislatively, 
makes more sense. For that reason, I commend Senator Isakson, who is 
the principal author of this. Senator Conrad has joined him, as I have 
and my staff. We worked together over the last number of days. Senator 
Shelby's staff has also been tremendously constructive and positive 
trying to put together this idea that would make sense to our 
colleagues.
  That is the difference. Do we go with a select committee made up of 
ourselves--and certainly every committee that has some jurisdiction on 
this would want some members on the committee. The idea that we would 
ask a group of us who have nothing to do with the subject matter to 
become part of the select committee also works counter to what we are 
trying to achieve, and so the Members who have jurisdiction, I assume, 
would insist on being a part of it.
  Which subcommittee chairs it? How do you decide how big that 
committee is? All these are matters which could end up dividing us, 
when our job ought primarily to be to find out what went on and utilize 
a means that would help us achieve that and then, more importantly, to 
do our jobs to make sure the very problems and gaps that existed to 
allow this problem to emerge are taken in so we plug those, in effect, 
or mend those in a way and help create that architecture that would 
allow our economy to grow, the confidence to be restored, and the sense 
of optimism to come back to our country.
  I am very complimentary of my colleague from North Dakota for talking 
some weeks ago. He is not a Johnny-come-lately to the issue. He argued 
for this idea of looking back. I thought about it a lot and have been 
trying to determine which way is the best for us to proceed. It is 
always with some regret when you disagree with a friend--not about the 
goals. In that there is an absolutely common interest. But which of the 
methods should we use to help us achieve those goals? I believe our 
colleague from Georgia and our colleague, ironically, from North Dakota 
as well--the two Senators from North Dakota are kind of on opposite 
ideas of this issue. Not on the issue of what we ought to achieve but 
rather----
  Mr. DORGAN. Would the Senator yield on that point?
  Mr. DODD. I will be happy to yield.
  Mr. DORGAN. We are not on opposite sides, necessarily. I said I 
support the Isakson-Conrad-Dodd Commission; I don't think it is a case 
of either/or. I think it is a case where both are necessary. But I wish 
to make the point I am not at odds with my colleague from my State or 
Senator Dodd or Senator Isakson on this issue.
  Mr. DODD. I stand corrected on that point. I appreciate my colleague 
making that correction.
  That is my case, basically. I don't know what my colleague from 
Georgia, Senator Isakson, or my colleague, Senator Conrad, had to say 
about this, about how this might have to be constructed, but this may 
be a choice we have to make in the coming half-hour or an hour or so, 
as to which of these ideas we will use. The idea that we do both gets a 
little complicated but, nonetheless, sometimes as an institution we are 
inclined to take the course or the path of least resistance on these 
matters, which sometimes can even add to more difficulties down the 
road.
  But I urge my colleagues to support the Isakson-Conrad-Dodd proposal. 
We think it makes a great deal of sense to achieve that very important 
goal while simultaneously allowing this institution to perform the 
function many would expect us to fill and that is to start crafting the 
structures that would allow the modernization of our financial 
institutions in a responsible and thoughtful manner. That work alone, 
as the Presiding Officer knows, is going to be almost all consuming in 
the coming weeks.
  With that, I yield the floor and thank my colleagues for their 
attention on this matter.
  The PRESIDING OFFICER. The Senator from North Dakota is recognized.

[[Page S4549]]

  Mr. DORGAN. Mr. President, I, too, rise in support, as I have 
indicated earlier, in support of the proposal that was offered by my 
colleagues, Senator Isakson, Senator Conrad, Senator Dodd. I think it 
is a worthy thing. As I indicated, I offered a Taxpayer Protection Act 
in late January that included a commission involved in that 5-step 
proposal. But I think they have dramatically improved on that. I think 
this bill they have offered is one worthy of support, and I certainly 
support it. I think an outside commission makes a great deal of sense.
  But as I indicated, it is not either/or. It cannot and should not be 
either/or. This notion that somehow this is too much politics in the 
Congress to be evaluating what has happened here and what you need to 
do about it--I don't know. John F. Kennedy used to say that every 
mother kind of hopes her child might be able to grow up to be 
President, as long as they don't have to be active in politics. Oh, 
yeah? Politics is what we do. The political system is the system in 
which we make decisions. I happen to agree--the New York Times wrote a 
piece about this, and I agree with it fully:

       The investigation should not be performed by outside 
     experts . . . whose report the Congress is free to accept or 
     reject. It should be a part of the Congressional process and 
     include an investigator with subpoena power and the right to 
     participate in the questioning of witnesses, as well as to 
     prep lawmakers for the hearings.

  Let me make this point. This is not either/or. I support this 
Commission. This Commission makes sense. My colleague from Georgia is 
here, and I wish my colleague from North Dakota were here because, as I 
read the proposal of theirs, they have done some good work. I strongly 
support it.
  But let me make this point. In addition to an outside commission 
taking a look outside of this institution, it is this Congress that has 
offered up $700 billion of funding to the Secretary of the Treasury. 
That is what this Congress has done: Here is $700 billion. We are the 
ones who appropriate the money. Accountability exists to do what is 
necessary to find out what has happened, to do the master narrative of 
what has occurred here and what are the things we can and must and 
should learn from that.
  Let me describe a select committee. Let me describe a committee in 
1940 named the Truman Committee. Harry S. Truman on the floor of this 
Senate, with a member of his own party in the White House, said there 
is unbelievable waste and fraud going on in defense spending and we 
ought to investigate it. They investigated for 7 years with a special 
committee. They did 60 hearings a year. Think of that. The committee 
spent $15,000 to be created and saved the taxpayers $15 billion over 7 
years.
  What an unbelievable value that was for the Senate to have done, the 
Truman Committee. In fact, you know, I spoke a while back to Herman 
Wouk, one of the great authors in America, the author of ``War and 
Remembrance'' and so many other great works. He is in his nineties, one 
of America's great authors. He is still writing, by the way.
  One of the things he talked about, he said, I do not know a lot going 
forward, but I know from about 1950 back, 1945 back.
  He talked about the Truman Committee as a part of the history of what 
the Senate has done in the middle of the Second World War, a special 
committee established by the Senate, the Truman Committee, bipartisan, 
subpoena power, 60 hearings a year, 7 years. Saved the taxpayers $15 
billion, we are told.
  Well, you know, I am on the floor with my colleague from Arizona, 
Senator McCain, because both of us believe there is a requirement for a 
select committee in this case. The Truman Committee, Kefauver Committee 
on Organized Crime, Church Committee, Kerry-McCain on POWs-MIAs I mean 
there have been a lot of examples of committees that have done some 
extraordinary work here on very big issues.
  I said before my colleague from Connecticut came in something that 
will embarrass him, I am sure. I said the Banking Committee with my 
colleagues Senator Dodd and Senator Shelby is doing extraordinary work 
that most of us are not aware of, because we are not sitting over there 
hour after hour after hour trying to put together the notions of what 
are the solutions to get us out of this ditch.
  The Banking Committee has done extraordinary work and continues to do 
it and will be required to do that for months now to try to lift this 
country. So my hat is off to the work of Senator Dodd, the leadership 
he offers us, and all of those who are working on the Banking 
Committee. This proposal for a select committee is not a reflection on 
their work at all.
  But I would say this: There is not one committee in the Congress--
that includes the Banking Committee--there is not one committee here 
that has anything more than three or four or five investigators at 
best. No committee has the capability that ought to exist and ought to 
be required to discharge the responsibilities that fall on the 
shoulders of this Congress and this Senate, in my judgment.
  I know the Speaker of the House last week talked about a Pecora 
committee. In fact, they called it a Pecora Commission. Pecora, that 
was not a select committee, but that was right after the financial 
collapse and the Great Depression. He held a lot of hearings, a lot of 
hearings. He was I believe the chief counsel to the Senate Banking 
Committee. History records the Pecora committee or Commission, the 
Pecora effort. We remember it in 2009 it was so significant, because he 
was looking back.
  Senator Dodd does not have that luxury at the moment. We have got to 
look forward and lift this country up and put the economy back 
together. And we have got to do it in a hurry. We do not have 3 years 
or 5 years. We have got to lift this country out of this ditch. This is 
a financial crisis unlike anything we have seen since the Great 
Depression. So they do not have a lot of luxury over in the Banking 
Committee to say, you know what, we are going to spend a lot of time 
looking in the rearview mirror. But I will tell you this: If we do not 
fully understand the narrative of what has happened here, we are 
destined someday to repeat it. We are destined to allow it to happen 
again.
  I said this, and this relates to the underlying bill on the floor 
that Senators Leahy, Grassley, and others have brought here. Go to the 
Internet today and take a look at this. This is one. I could have 
brought many. This is a company who says--it is called 
speedybadcreditloans.com.
  After all we have faced and the financial collapse and the subprime 
loan scandal, with a bunch of bad actors leaving with hundreds of 
millions of dollars of ill-gotten gains and leaving victims in their 
wake all over this country, massive foreclosures and the financial 
collapse--after all of this, go to the Internet today, and find a 
company that is called speedybadcreditloans. They say on the Internet: 
Do you have bad credit? That is okay. Do you have no credit? That is 
all right. Do you have bankruptcy? No problem. Come and get a loan from 
us. Is that unbelievable? Just unbelievable.
  There is one more, CC&G Financial Group. If you have bad credit, you 
got poor credit--I could do 40 of these, by the way--come to us. We can 
get you into your dream home, by the way. They say: With all of these 
values due to foreclosures and short sales, now is the time. Got bad 
credit, got an appetite to get a new home.
  I wonder if they are doing what those mortgage companies did that 
steered us into the ditch to say to potential borrowers: Hey, come over 
here. You are paying $700 a month house payments. You know what, we 
will give you a mortgage to pay $200 a month. Why should you pay more 
than triple what you ought to pay? You get a mortgage from us, $200 a 
month. Oh, by the way, you do not even have to document your income. We 
do not care. We will charge you an extra quarter percent, but you do 
not have to document it. Well, maybe 2.25 percent will be your new 
mortgage, maybe $210 a month. We are going to put a little deal in 
there, it is going to reset in 3 years, it is going to be 12 percent. 
That may be a problem, but do not worry, that home value is going like 
that. You can sell it if there is a problem. But we are going to allow 
that to reset. And we are not going to mention this to you. We are 
going to put a prepayment penalty in it so you cannot get out of this.

[[Page S4550]]

  Then what we are going to do is we are going to wrap it into a big 
piece of sausage, like they used to fill sausage with filler. Then we 
are going to chop it up and we are going to sell it. We have got hedge 
funds and investment banks that are yearning for these kinds of 
instruments. So we sell the risk. I am a big old mortgage company that 
advertises: We want bankrupt people to come to us. We want people with 
bad credit to come borrow with us, because, you know what, we are not 
going to sit across the desk and look into their eyeballs to see 
whether they can repay this loan. No, we are not going to do that. We 
are going to sell the risk. So we do not have to do what is called 
underwriting. That means sitting across the desk, and the lender 
evaluates whether the borrower can actually repay it. It is the old way 
you used to do things, not the modern way. It is the old way. You do 
not have to underwrite if you are going to sell the risk. In fact, sell 
it two or three times.
  Then, by the way, when someone is being foreclosed upon, the new 
technique is to say in court: Show us the original mortgage. And they 
are having a devil of a time trying to find an original mortgage 
because it has been sold upstream. Disconnect the borrower and the 
lender from the risk--well, not the borrower, but the lender from the 
risk. And meanwhile they are all making massive amounts of money.
  You know, the year before last, I looked up to see who was the 
biggest income earner in the country in the middle of this unbelievable 
avalanche of financial good news. Who earned the biggest income in the 
country, individually?
  Well, a guy who ran a hedge fund earned the biggest income, $3.6 
billion. Now, that person earned in 3.5 minutes what the average worker 
in America earned in a year. When that person comes home and says: I 
had a pretty good day, and the spouse says: Well, honey, how are you 
feeling?
  Well, I made $10 million today.
  Mr. President, $10 million every day. How is it that people were 
working those kinds of stratospheric incomes, $3.6 billion, or even 
much lower, a CEO from one of the biggest mortgage banks in the country 
that went belly up, and he left with a couple of hundred million 
dollars, much lower income? How is it they ended up with all of this 
money? They ended up with all of this money by creating all kinds of 
fancy instruments and getting payments by moving all kinds of money 
around and a lot of victims in their wake. So the question is, what do 
you do about all of this? Well, the first thing to try to understand 
here is what has happened. I am talking now about subprime mortgages.
  But you know what, that is one piece. It is like a book with several 
chapters, many chapters. It is one piece. But I am describing how 
unbelievable this piece is. So the question is, what do we know at this 
point? What really do we know about what has happened that has caused 
this collapse?
  I talked about dark money a bit ago. Debt helped cause this collapse. 
Some of that is here. Federal budget debt. Federal trade debt, by the 
way, $800 billion a year trade debt. That is money we owe to other 
countries, $800 billion a year.
  So debt, part of our responsibility. Somebody said to me, well, it is 
the Federal Government that is spending more than it has. I said: Oh, 
really, have you taken a look at credit card debt and household debt? 
Doubled in a reasonably short period of time. Corporate debt. Take a 
look at household and credit card and corporate debt. Dramatic 
increases. Take a look at Federal debt by the Congress. Substantial 
increases. Trade debt. Debt is a problem. We know that.

  Deregulation. You decide, you know what, we are going to loosen the 
rules and not look. We will hire regulators who want to boast that they 
do not have the foggiest interest in seeing what is happening. Boy, 
that is a recipe for disaster. And yet that is exactly the case. Dark 
money, all of this money.
  Did anybody know I wrote a piece in 1994, 1994, that was the cover 
story for the Washington Monthly magazine? My article was the cover 
story for the Washington Monthly magazine 15 years ago that was titled: 
``Very Risky Business.'' It was about the notion that at that point 
there were $40 to $50 trillion dollars of notional value of derivatives 
in this country. So there is a lot to discuss about the narrative of 
what has happened with this financial crisis. Some take the position 
that we should do only a commission and they oppose a select committee 
of the Senate. I support a commission because I think that would 
provide another view, another way of outside experts. I think as I said 
before my colleague from Georgia came in, Senator Isakson and Senator 
Conrad have produced a piece of legislation that I think is very 
smartly done, very well crafted, makes a lot of sense. I stand here to 
strongly support it.
  But I disagree with my other colleague who seemed to suggest that it 
is an either/or. Doing an outside commission does not absolve the 
responsibility of the Congress, in, I think, one of the most 
significant and momentous events of our lifetime, that is, the 
financial collapse that has, at its root, so many different causes.
  It does not absolve us of the responsibility to do what is necessary 
to investigate that cause, understand it, and make sure it can never 
happen again.
  Again, let me read from the editorial I started with from the New 
York Times:

       Investigation needs to be a part of the Congressional 
     process, and include an investigator with subpoena power and 
     the right to participate in the questioning of witnesses, as 
     well as to prep lawmakers for the hearings [and so on.]

  We have done that in the past with the Watergate hearings. We have 
done it in the past with the Church hearings. We have done it in the 
past with the Truman Committee, which I think is a shrine to what this 
Congress can and should do when it puts its mind to it.
  If we decide we cannot do it now and should not do it now, we will 
have missed a very significant opportunity, and we will have abrogated 
a significant responsibility of this Congress. It is our job as well. 
So I stand here to say, I strongly support the commission proposal. We 
will vote for it. I am very pleased my colleagues have offered it.
  But I also believe, as Senator McCain does, that there is more to do 
and there is a responsibility that cannot be delegated. And that 
responsibility that cannot be delegated is our responsibility to 
empanel a select committee to do what is necessary to investigate from 
the standpoint of the Congress what has happened to cause this very 
substantial financial crisis.
  I ask unanimous consent to lay aside the pending amendment, and I 
offer the amendment I have described.
  The PRESIDING OFFICER (Mr. Burris). Without objection, it is so 
ordered.
  Mr. DORGAN. Let me withhold my request.
  The PRESIDING OFFICER. The request is withdrawn.
  Mr. DORGAN. I will withhold that request for a moment. While I am 
waiting, let me say that the underlying bill we are dealing with is a 
piece of legislation that will address the opportunity to prosecute, 
which is another issue, prosecute wrongdoing and illegal behavior and 
some of these financial shenanigans that we have seen and that I have 
discussed.
  The underlying bill as well as a piece of legislation is something I 
would strongly support.
  The PRESIDING OFFICER. The Senator from Georgia.
  Mr. ISAKSON. Mr. President, I thank the Senator from North Dakota for 
his comments with regard to the commission. I want to reiterate what I 
said in my earlier speech. When I thought about this, when I watched my 
kids' 529s, when I watched my own savings for retirement, when I saw 
what was happening to men and women across the United States, I felt 
this was a situation that needed a forensic audit, maybe even an 
autopsy. The damage had already been done. There were multiple factors 
that led to it. I am not smart enough--I don't know that anybody is--to 
put a finger on exactly where the blame lies, but I know this: To not 
find the problems and cure them would be a mistake on the part of the 
Senate.
  Without talking about the select committee as a pro or a con, I want 
to say why I didn't go that route with this legislation. We are part of 
what needs to be scrutinized--the Senate. We are part of what needs to 
be seen. If we left this just strictly to a select committee,

[[Page S4551]]

it would be like appointing the board of directors to AIG to tell us 
what went wrong with AIG. It wouldn't be a good autopsy. It wouldn't be 
objective. Senator Conrad and I have tried to put together a piece of 
legislation that no one could say is partisan, that no one could say is 
loaded, that is objective, that gives subpoena power to individuals who 
have the credibility, the knowledge, and the past experience to 
evaluate the highly technical derivatives, the highly technical hedge 
funds, and the rules of trading on the Securities and Exchange 
Commission.
  We may need a select committee for oversight if our committees can't 
do oversight. But we do not need a select committee to investigate the 
collapse that has happened. We need an independent body, independent of 
this body. We need them to have the power and the funds necessary to 
get the answers to the problem so we can objectively say we exposed 
ourselves to the same scrutiny to which we wish to expose everybody 
else. We will have the recommendations of what went wrong, who might 
have done wrong, and if there were criminal acts on the part of 
somebody, referrals to the Justice Department.
  This is a clean, targeted, bipartisan, specific approach to address 
the No. 1 financial problem the American people are facing today, and 
that is the collapse of their savings and the retirement and college 
education funds of millions of Americans.
  I appreciate the endorsement of the Senator from North Dakota, but I 
want to make sure we understand that a select committee would be no 
substitute for this independent commission at this time.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Oregon.
  Mr. MERKLEY. Mr. President, I rise to speak in strong support of the 
underlying bill, the Fraud Enforcement and Recovery Act of 2009, and in 
particular about its impact on detecting fraud in the housing industry. 
First, however, let me offer my appreciation to the senior Senator from 
Vermont for bringing forward this important piece of legislation for 
our consideration. We all know the grave nature of the economic crisis 
we are in. Oregon has been hit particularly hard. The unemployment rate 
in Oregon is 12.1 percent. It has nearly doubled in just over 6 months, 
the second highest unemployment rate in the Nation. Oregonians are 
going into foreclosure at record rates. This legislation, by giving law 
enforcement additional tools, will help stop the bleeding and begin the 
process of addressing an underlying problem that caused this crisis, 
deceptive practices in the mortgage industry.
  The bill before us today is straightforward but important. It gives 
the Government the extra tools and resources it needs to combat, 
identify, and prosecute financial fraud. As the Federal Government 
spends billions to bring stability to the economy, the modest amount of 
money authorized in this bill will go a long way to protect our 
investments and return money to the taxpayer.
  Let me highlight just how important this effort is in the area of 
housing. A lot of attention has been paid to the rising number of 
foreclosures and the havoc these foreclosures are wreaking on the 
housing market. But not so much attention has been paid to the role 
fraud has played in causing these foreclosures.
  Just last month, HUD's interim report on the root causes of the 
foreclosure crisis found that 1 in 10 delinquencies in this crisis has 
been associated with some form of fraud. That means this week alone 
5,000 families will lose their homes to foreclosure as a result of 
fraud. That is 5,000 families too many.
  Mortgage fraud is at an all-time high. The Mortgage Asset Research 
Institute has found that mortgage fraud increased by 26 percent from 
2007 to 2008. Sadly, this number is only growing as new schemes come 
forward seeking to defraud Americans of the financial foundation of 
their future.
  Let me give a couple of examples. In one widespread fraud, buyers 
with stolen identities bought homes. If the value of the homes went up, 
they sold the homes and cashed in. If the value of the homes went down, 
they walked away, leaving not only a vacant home but leaving the 
unsuspecting victim of identity theft in a very difficult situation.
  In another case identified by HUD, defrauders inflated home values 
through bogus appraisals, fabricated borrowed deposit amounts, 
falsified loan documents to obtain FHA-insured mortgages, and HUD lost 
$2.3 million on just 30 mortgages. Over 9,000 FHA loans have entered 
into default after no or only one payment, a particular sign of fraud.
  HUD's inspector general has done much to address this. The office 
captured $2 billion in questionable expenses, obtained $80 million in 
restitution money, and closed over 1,000 cases. That is a significant 
effort. But it is only the tip of the iceberg. That is why this fraud 
act we are considering today is so important. It takes a significant 
step in restoring an investigative unit that was largely dismantled in 
2003 under the Bush administration. It expands the inspector general's 
staff. It takes an important step to restore investigative capabilities 
which are so important to protecting the vital nature of the American 
housing market. In these extraordinary economic times, we need to be 
especially vigilant against new forms of fraud.
  I am thinking now of the predatory foreclosure scams that so many of 
my Oregon constituents have been talking about. These scams engage in 
deeply deceptive practices and sometimes outright fraud. The worst of 
these schemes falsely promised homeowners a way out of foreclosure if 
they put up a small fee of several thousand dollars. In one such scam--
I will call the couple John and Mary who were affected. They are 70 
years old and 66 years old, respectively, hard-working Oregonians. John 
is a self-employed trucker. Most of his business is generated from 
hauling debris from the demolition of houses. His business has declined 
with the fall-off of new construction.
  In the course of things, John and Mary struggled to keep up their 
mortgage payments. They reached out to their servicer--at the time it 
was Countrywide--to explore their options but couldn't connect and get 
anyone to work with them on their mortgage. But telemarketers started 
calling with offers to help them modify their mortgage for $2,000 or 
$3,000. It is fortunate that John and Mary didn't sign any of these 
contracts but instead contacted my office. We connected them with a 
HUD-approved housing counselor who was able to help them modify their 
loan and get back on a straight path.
  Let me tell my colleagues what might have happened; that is, a scam 
in which not only is the family facing foreclosure asked to put up a 
fee, but they are asked to sign over their house to the firm, and then 
they are converted into being a renter. When they miss a rent payment, 
they are evicted from their house. So not only do they lose their 
investment, they lose a place to live. They can go from a homeowner in 
slight trouble to homeless in short order.
  These scams are unacceptable. It is our job to step forward and 
protect the American people. We must fireproof our mortgage lending 
business and ban deceptive and risky practices. In the coming days, I 
and others will be offering and working on legislation to reestablish 
sound practices in the mortgage finance markets. But today we consider 
a significant act that empowers our officials to lay down a firebreak 
against the most blatant forms of fraud. I encourage colleagues to 
support it. It is an important step. Let's work together to protect 
American homeowners.
  I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. LEAHY. I ask unanimous consent that the order for the quorum call 
be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. LEAHY. Mr. President, I ask unanimous consent that the Senate 
proceed to vote in relation to amendment No. 995 at 4:32 p.m. today and 
that the 4 minutes immediately prior to the vote be equally divided and 
controlled between myself and Senator Isakson or our designees; that no 
amendment be in order to the amendment prior to a vote in relation 
thereto; and upon disposition of amendment

[[Page S4552]]

No. 995, Senator Dorgan be recognized to offer his select committee 
amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Georgia.
  Mr. ISAKSON. I thank the chairman for the 2 minutes.
  Mr. President, Senator Conrad and I have worked very diligently for 
3\1/2\ months to create a platform in which we can get the answers the 
American people deserve and need with regard to the financial collapse 
that happened to this country. We have created a bipartisan commission 
that has no elected officials on it--all experts are within their 
chosen fields--a commission that has both subpoena power and the 
funding necessary to do precisely what the 9/11 Commission did. It is 
structured in the same way except targeted on the investigation of the 
financial markets, the securities markets, the commodities markets, 
Freddie Mac, Fannie Mae, the financial services market, the hedge 
funds, and every other institution that had a part in what has been a 
collapse of our economic system and a great decline in the value of 
equity for our people, college savings for their children, and 
retirement for their future.
  I urge colleagues to vote favorably on the creation of the Financial 
Markets Commission.
  I retain the remainder of my time.
  The PRESIDING OFFICER. Who yields time?
  The Senator from Vermont.
  Mr. LEAHY. Mr. President, has the Senator from Georgia requested a 
rollcall vote?
  Mr. ISAKSON. Mr. President, I consulted with Senator Dodd and Senator 
Conrad, both of whom want a rollcall.
  Mr. LEAHY. Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  Mr. LEAHY. Mr. President, I yield back all time and ask that the 
rollcall vote start now.
  The PRESIDING OFFICER. If all time is yielded back, the question is 
on agreeing to amendment No. 995.
  The clerk will call the roll.
  The legislative clerk called the roll.
  Mr. DURBIN. I announce that the Senator from Massachusetts (Mr. 
Kennedy) and the Senator from West Virginia (Mr. Rockefeller) are 
necessarily absent.
  Mr. KYL. The following Senator is necessarily absent: the Senator 
from Kansas (Mr. Roberts).
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 92, nays 4, as follows:

                      [Rollcall Vote No. 161 Leg.]

                                YEAS--92

     Akaka
     Alexander
     Barrasso
     Baucus
     Bayh
     Begich
     Bennet
     Bennett
     Bingaman
     Bond
     Boxer
     Brown
     Brownback
     Burr
     Burris
     Byrd
     Cantwell
     Cardin
     Carper
     Casey
     Chambliss
     Coburn
     Cochran
     Collins
     Conrad
     Corker
     Cornyn
     Crapo
     DeMint
     Dodd
     Dorgan
     Durbin
     Ensign
     Enzi
     Feingold
     Feinstein
     Gillibrand
     Graham
     Gregg
     Hagan
     Harkin
     Hatch
     Hutchison
     Inhofe
     Inouye
     Isakson
     Johanns
     Johnson
     Kaufman
     Kerry
     Klobuchar
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Lugar
     Martinez
     McCaskill
     McConnell
     Menendez
     Merkley
     Mikulski
     Murkowski
     Murray
     Nelson (NE)
     Nelson (FL)
     Pryor
     Reed
     Reid
     Risch
     Sanders
     Schumer
     Sessions
     Shaheen
     Shelby
     Snowe
     Specter
     Stabenow
     Tester
     Thune
     Udall (CO)
     Udall (NM)
     Vitter
     Voinovich
     Warner
     Webb
     Whitehouse
     Wicker
     Wyden

                                NAYS--4

     Bunning
     Grassley
     Kyl
     McCain

                             NOT VOTING--3

     Kennedy
     Roberts
     Rockefeller
  The amendment (No. 995) was agreed to.
  The PRESIDING OFFICER. The majority leader.
  Mr. REID. Mr. President, it is my understanding that the Senator from 
North Dakota, Mr. Dorgan, is offering an amendment. We are not going to 
have any more votes tonight. If there is a vote required, we will add 
it to whatever we have to vote on tomorrow morning. The managers are 
here, willing to take whatever amendments they think are appropriate 
tonight.
  As I have indicated to the Republican leader, we are going to finish 
this bill this week, and we are going to finish the budget, getting it 
to conference this week. We hope we can do it in a real short week; 
otherwise, we will have to work into the weekend, which we don't want 
to do and there is no reason to do that. I have a couple of meetings I 
have to attend tonight involving the Speaker and the President, so we 
can't have any more votes tonight. I apologize to everyone if they 
wanted to vote late tonight. I don't think we will be able to do that.
  Mr. LEAHY. Mr. President, will the Senator yield?
  Mr. REID. Yes.
  The PRESIDING OFFICER. The Senator from Vermont.
  Mr. LEAHY. Mr. President, I appreciate the comments of the Senator 
from Nevada, the distinguished majority leader. I will stay here for a 
few minutes, if there are some amendments pending. If there are some 
amendments pending that we could take by voice vote, I am perfectly 
willing to do that tonight. If there are rollcalls, if there are 
amendments people think will need rollcalls, I don't know what time the 
distinguished leader wants to go back on the bill in the morning, but I 
would suggest that if we start early on that----
  Mr. REID. If my friend would yield, we will have no morning business 
tomorrow, so we will go to this bill early. But sometime tomorrow we 
are going to have to go to the budget and conference, so we should, by 
1 or 2 o'clock, do our best to finish this bill.
  Mr. LEAHY. Then if I might further inquire of the leader--and I think 
that is perfectly fair--I intend that at such time as there are no 
amendments pending, or no amendments pending that people actually 
expect to go forward, we will go to final passage.
  This is a bill that saves taxpayers' money but more importantly 
protects a lot of people who are being preyed upon by people wanting to 
defraud them out of their homes, out of their retirement, out of the 
money they have saved for their children to go to college. So I think, 
with what is happening--and it has been proven--all of these frauds 
that have taken place all over the country, the last thing in the world 
the American people want to see is us delay it.
  I thank the distinguished leader for bringing up this bill this week. 
It is my intention--my hope, anyway--to have it finished by noon 
tomorrow.
  The PRESIDING OFFICER. The majority leader.
  Mr. REID. Mr. President, I would also say to my friend that he 
covered everything except that this is a bipartisan bill, it is as 
bipartisan as any bill could be, and there shouldn't be any problem. If 
people have amendments, the managers of the bill have been ready for 
those amendments all day.
  Mr. LEAHY. I would note further to the leader that Senator Grassley, 
who is not only the chief sponsor, but we have a dozen or so sponsors 
on both sides of the aisle--Senator Grassley and I worked very closely 
with a number of Senators to work out amendments. The first amendment 
we brought up was one we worked on with Senator Kyl on, and I think 
that passed 95 to 1, or something like that. So we are ready to work 
with people, but we will finish this bill soon.
  Thank you. I yield the floor.
  The PRESIDING OFFICER. Under the previous order, the Senator from 
North Dakota is recognized.


                           Amendment No. 999

   (Purpose: To establish a select committee of the Senate to make a 
    thorough and complete study and investigation of the facts and 
  circumstances giving rise to the economic crisis facing the United 
 States and to make recommendations to prevent a future recurrence of 
                             such a crisis)

  Mr. DORGAN. Mr. President, I ask unanimous consent that the pending 
amendment be set aside so that I can offer an amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The clerk will report.
  The legislative clerk read as follows:

       The Senator from North Dakota [Mr. Dorgan], for himself and 
     Mr. McCain, proposes an amendment numbered 999.

  Mr. DORGAN. Mr. President, I ask unanimous consent that the reading 
of the amendment be dispensed with.

[[Page S4553]]

  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The amendment is printed in today's Record under ``Text of 
Amendments.'')
  Mr. DORGAN. Mr. President, I have spoken on this amendment 
previously. I have spoken of the underlying bill Senator Leahy and 
Senator Grassley and others have brought to the floor and my admiration 
for that bill. That bill falls right in with what the responsibility of 
the Senate should be at this point. I commend them for that. It is not 
my intention, nor would it be the intention of my colleague, Senator 
McCain, as we offer this amendment to in any way interrupt the 
legislation on the floor. We believe our amendment enhances it.
  Second, let me say to my colleague, Senator Dodd, the chairman of the 
Banking Committee, I have spoken at length about what they are doing to 
try to put the pieces together to lift this country out of the ditch 
and try to figure out how to put this financial system together in a 
way that makes it work again.
  Having said all of that, I indicated earlier that I offered an 
amendment with my colleague, Senator McCain, that would establish a 
select committee of the Senate, in the tradition of the Truman 
Committee and the Watergate Committee and other select committees, to 
try to do a narrative of what has happened with respect to the 
financial crisis. I believe that a commission is fine, but we cannot 
delegate all responsibility. There is a responsibility for Congress to 
do comprehensive oversight on this issue, which I think is the largest 
financial issue we have faced--the financial crisis, the financial 
collapse--since the Great Depression.
  Mr. LEAHY. Will the Senator yield for a question?
  Mr. DORGAN. I am happy to yield.
  Mr. LEAHY. Mr. President, I understand there is a request for a 
rollcall on the Senator's amendment. I was not going to ask for one, as 
he knows. I wonder if he would have any problem with a unanimous 
consent agreement that when we come back on the bill in the morning, 
his amendment will be the pending amendment and there be 10 minutes a 
side, and we then proceed to a vote on it.
  I am throwing this out as a suggestion, so my colleagues will hear 
it. For one thing, rather than spend several hours on the same 
amendment in the morning, or tonight, perhaps we will be able to do 
this: I say to the floor staff that this is a unanimous consent request 
that I will be making. I do not intend to make a unanimous consent 
request at this time. I will soon make this request.
  Mr. DORGAN. Mr. President, I would certainly agree with that. It is a 
fair request. Let me finish so my colleague, Senator McCain, can say a 
few words as well.
  This amendment doesn't do a disservice to the underlying bill. It is 
exactly in the tradition of what the Senate ought to do. We cannot 
delegate the responsibility. This financial crisis has imposed an 
enormous burden on this country. All of us hope and pray that we can 
lift this country out of this difficulty. We are all working to do 
everything we can.
  Do you know what. We need to understand what is the dimension, the 
narrative of what happened, what caused all of this, and make sure we 
put into place things that will prevent it from happening again. That 
is our responsibility. In the grand tradition of the Senate of select 
committees on big issues, this ought to be a bipartisan select 
committee with subpoena power to understand what happened and to make 
sure it can never happen again. That is why I have offered this with 
Senator McCain.
  I have one final point. I hope we will be able to get you to take 
this without a recorded vote. Maybe only one person in the Senate has 
suggested maybe a recorded vote is necessary. We can talk to this 
person, and we can talk to that person. Whatever the request will be by 
the chairman, I will be amenable to it.
  I yield the floor so that my colleague from Arizona may speak.
  The PRESIDING OFFICER. The Senator from Arizona is recognized.
  Mr. McCAIN. Mr. President, I also thank the chairman of the Judiciary 
Committee and floor manager for his cooperation. We are trying to get 
the request for a recorded vote vitiated. Right now, there is a request 
on this side for a recorded vote. Whatever, I know the distinguished 
manager wants to move forward with the bill. We are ready to dispense 
with it as quickly as possible. Senator Dorgan and I have spoken at 
sufficient length.
  I thank Senator Dorgan again for this very important legislation. Why 
is it important? Mr. President, America is in the midst of the greatest 
economic crisis of our lifetime. The American people are angry and 
confused. They have a right to know what caused this. But, most of all, 
they have a right to know the path out so that we can prevent it from 
ever happening again to the American people.
  All the cards have to be put on the table. Everything that happened 
that caused this--somebody called it a ``house of cards'' that 
collapsed. Many Americans lost homes, jobs, health insurance, and their 
very futures. They deserve to know. The most effective way to do that, 
in my view, is a select committee.
  I have seen select committees in action before. They have been 
efficient and effective. The American people have a right to know what 
caused this train wreck and how we can prevent it from ever happening 
again. I hope my colleagues cannot only voice-vote it but put enough 
pressure on so that we could act immediately with the appointment of 
this select committee with subpoena powers, which I am confident will 
have bipartisan participation, bipartisan support, and the nonpartisan 
support of the American people.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. DORGAN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DORGAN. Mr. President, let me just make another brief comment 
about the amendment that is pending. I will be mercifully brief. I 
mentioned earlier the grand tradition of the Senate, as demonstrated by 
the Truman committee, Harry Truman, a former Member of this body, who 
had a select committee established in 1940 to investigate waste and 
abuse and fraud with respect to defense contracting. When I talked 
about the Truman committee, I said I had talked to one of America's 
great authors, Herman Wouk. I mentioned his book, ``War and 
Remembrance.'' He also wrote ``Winds of War'' and ``Caine Mutiny.'' He 
is an unbelievably wonderful man who is now 92 or 93 years old. I had 
the opportunity, last year and the year before, to visit with him. He 
is still writing; he is writing a new work. He talked about the Truman 
committee. He said something interesting because he wrote so much about 
especially the Second World War.
  He said, ``I don't know much beyond 1945, but I know everything just 
before 1945.'' He put it in his wonderful books. Then he talked about 
the contracting going on in Iraq and the stories of waste, fraud, and 
abuse--perhaps the greatest waste, fraud, and abuse in this country--
those are my words. He said, ``You ought to create a Truman 
committee.'' He described to me the select committee headed by Harry 
Truman.
  I went back and read the record of what they did in 1940--Truman with 
a member of his own party in the White House. He traveled around the 
country to military installations and met with contractors on military 
bases, and he concluded there needed to be an investigation. They put 
together a bipartisan committee with subpoena power. It cost $15,000 to 
create a select committee and it met for 7 years and held 60 hearings a 
year and it saved the taxpayers by cutting down on the waste and abuse 
in defense contracting. They did it in the middle of a war. Think of 
it.
  My point earlier, when I mentioned Herman Wouk, was to describe the 
Truman committee in the grand tradition of what the Senate can do when 
it should do what is necessary to make certain that the economy works 
and the taxpayers' money is spent effectively. So now we find ourselves 
in a circumstance unlike any we faced in my lifetime--an unbelievable 
financial wreck that has occurred. The victims of that wreck are all 
over. We have lots of folks--millions--looking for a job.

[[Page S4554]]

Can you imagine one person coming home--just one--saying: Honey, I have 
lost my job today. I worked there for 20 years, and I have done a good 
job. It is not my fault. I have tried hard, but I don't have a job 
anymore because I was told they are laying off at the office or plant. 
Think of that conversation--to tell the kids that dad or mom doesn't 
have a job anymore. Not just one time or 100,000 times--think about the 
millions of times that it happened in recent months; 3.6 million people 
since the recession began have had to come home and say: I have lost my 
job.
  These are people who want to work. It describes why it is so 
important for an economy to expand and lift opportunity in this great 
country.
  We have been blessed for a long time. It is not some inherent right 
of ours to live in an economy that grows in an unrelenting way. That is 
not an inherent right. This economy will grow and will produce expanded 
opportunities for the American people if we do the right things. We 
have been through a period where a lot of people in very important 
positions did a lot of wrong things, trading a lot of paper that didn't 
have any value at all, making money on both sides, buying things they 
never had from people who will never get it, and making money on both 
sides of the trade. That is not real finance. That is not real 
investment, real productivity. That is a paper economy that is built on 
speculation and is destined to come down.
  I described a while ago just the subprime loan scandal. That is just 
a part of it. I described it, and it almost makes me sick to see the 
greed and avarice that existed under the name of responsible business. 
Shame on all of those people who were making a lot of money. They were 
making so much they could not count it, and they were leaving victims 
in their wake. They created this circumstance where the economy 
collapsed.
  Our job is to find out what happened and try to lift it back up. You 
have to put the pieces of the puzzle together and decide and understand 
what happened. We owe it to ourselves and the American people to 
understand all of what happened to make sure we never allow it to 
happen again.
  We cannot delegate that responsibility. I supported the commission, 
and I complement my colleagues who offered it. Having an outside group 
of experts to look at this and make recommendations, that makes sense. 
But we cannot delegate our responsibility. It is our responsibility. 
That is why this amendment I have offered with Senator McCain is so 
important.
  Finally, the underlying bill to which we are talking about amendments 
is so important because it is part of the solution--to say those folks 
who have been doing those things--there has to be a responsibility and 
funding for prosecutors and investigators to get to the bottom of that 
and make people accountable for the actions and behavior that steered 
the economy into a ditch.
  I have great hope for the future of this country if we do the right 
thing. I believe we can. The step offered by Senator Leahy is a step in 
that direction.
  I yield the floor.
  Mr. LEAHY. Mr. President, I ask unanimous consent that on Thursday, 
April 23, after the Senate resumes consideration of S. 386, the time 
until 10 a.m. be for debate with respect to Dorgan-McCain amendment No. 
999, with the time equally divided and controlled between Senators 
Dorgan and myself, or our designees; that no amendments be in order to 
the amendment prior to a vote in relation thereto; that at 10 a.m., the 
Senate proceed to a vote in relation to the amendment.
  The PRESIDING OFFICER. Is there objection? Without objection, it is 
so ordered.
  Mr. LEAHY. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. INHOFE. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                 Amendment No. 996 to Amendment No. 984

  Mr. INHOFE. Mr. President, I ask for the regular order so that I may 
offer a second-degree amendment to the Reid amendment.
  The PRESIDING OFFICER. The regular order is the amendment.
  Mr. INHOFE. At this point, I wish to offer a second-degree amendment.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Oklahoma [Mr. Inhofe], for himself, Mr. 
     DeMint, and Mr. Vitter, and Mr. Alexander, proposes an 
     amendment numbered 996 to amendment No. 984.

  Mr. INHOFE. Mr. President, I ask unanimous consent that the reading 
of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

 (Purpose: To amend title 4, United States Code, to declare English as 
     the national language of the Government of the United States)

       On page 3, after line 8, add the following:
       (d) Amendment to Title 4.--
       (1) In general.--Title 4, United States Code, is amended by 
     adding at the end the following:

                ``CHAPTER 6--LANGUAGE OF THE GOVERNMENT

``Sec.
``161. Declaration of national language.
``162. Preserving and enhancing the role of the national language.
``163. Use of language other than English.

     ``Sec. 161. Declaration of national language

       ``English shall be the national language of the Government 
     of the United States.

     ``Sec. 162. Preserving and enhancing the role of the national 
       language

       ``(a) In General.--The Government of the United States 
     shall preserve and enhance the role of English as the 
     national language of the United States.
       ``(b) Exception.--Unless specifically provided by statute, 
     no person has a right, entitlement, or claim to have the 
     Government of the United States or any of its officials or 
     representatives act, communicate, perform or provide 
     services, or provide materials in any language other than 
     English. If an exception is made with respect to the use of a 
     language other than English, the exception does not create a 
     legal entitlement to additional services in that language or 
     any language other than English.
       ``(c) Forms.--If any form is issued by the Federal 
     Government in a language other than English (or such form is 
     completed in a language other than English), the English 
     language version of the form is the sole authority for all 
     legal purposes.

     ``Sec. 163. Use of language other than English

       ``Nothing in this chapter shall prohibit the use of a 
     language other than English.''.
       (2) Conforming amendment.--The table of chapters for title 
     4, United States Code, is amended by adding at the end the 
     following new item:
``6. Language of the Government..............................161''.....

  Mr. INHOFE. Mr. President, today I am offering an amendment that I 
have offered on two other occasions. It is called the National Language 
Act of 2009. I offer it as an amendment to the Reid amendment No. 984. 
This legislation recognizes the practical reality of the role of 
English as our national language. It makes English the national 
language of the U.S. Government, a status in law it has not had before, 
and it calls on Government to preserve and enhance the role of English 
as the national language. It clarifies that there is no entitlement to 
receive Federal documents in languages other than the English language 
unless required by statutory law, recognizing decades of unbroken court 
opinions that civil rights laws protecting against national origin 
discrimination do not create rights to Government services and 
materials in languages other than English.
  Let me be clear, there is nothing in the amendment that prohibits the 
use of a language other than the English language. When I offered this 
before, I remember several times people would stand up and object and 
the basis of that objection was that we were not able to use other 
languages. We can use other languages. I have spoken languages, such as 
the Spanish language, on the floor of this Senate. It has nothing to do 
with that.
  There is no prohibition against giving Medicare services, for 
example, or any other Government services in languages other than 
English. All this amendment does is simply say there is no entitlement 
unless Congress has explicitly provided so. This bill does not ban 
translation services being offered by Federal employees who have the 
language skills to do so. Instead, it eliminates the notion that once 
one translation is provided to someone in one language, a legal 
entitlement has been created to provide translations to anyone in any 
language they wish.
  The aim is to prohibit class action lawsuits based upon perceived 
entitlements that some individuals claim.

[[Page S4555]]

  The National Language Act is an attempt to legislate a common sense 
language policy that a nation of immigrants needs one national 
language. Our nation was settled by a group of people with a common 
vision. As our population has grown, our cultural diversity has grown 
as well. This diversity is part of what makes our nation great. 
However, we must be able to communicate with one another so that we can 
appreciate our differences. When members of our society cannot speak a 
common language, misunderstandings arise. Furthermore, the individuals 
who do not speak the language of the majority miss out on many 
opportunities to advance in society and achieve the American dream. By 
establishing that there is no entitlement to receive documents or 
services in languages other than English, we set the precedent that 
English is a common to us all in the public forum of government.
  I want to empower new immigrants coming to our Nation by helping them 
understand and become successful in their new home. I believe that one 
of the most important ways immigrants can achieve success is by 
learning English.
  There is enormous popular support for English as the national 
language, according to polling that has taken place over the last few 
years. Eighty-seven percent of Americans support making English the 
official language of the United States. Seventy-seven percent of 
Hispanics believe English should be the official language of government 
operations. Eighty-two percent of Americans support legislation that 
would require the Federal Government to conduct business solely in 
English. Seventy-four percent of Americans support all election ballots 
and other government documents being printed in English. This polling 
data refers to making English an ``official'' language of the United 
States, or further creating an affirmative responsibility on the part 
of government to conduct its operations in English. While I have 
drafted legislation that accomplishes this as well, the National 
Language Act is more measured, simply stating that no entitlement shall 
arise to government documents or services.
  OMB reported in 2002 that they could not accurately endorse any 
single cost estimate of providing materials and services to Limited 
English Proficiency--LEP--persons, but that the estimate ``may be less 
than $2 billion, and perhaps less than $1 billion.'' When talking about 
dollar amounts of this magnitude, we know the cost is high regardless 
of the OMB's ability to accurately calculate, and it is likely becoming 
higher. If we are spending all this taxpayer money for services in a 
foreign language, we need to at least clarify that there is no legal 
entitlement to such.
  My colleagues who have followed this debate will remember that the 
National Language Act of 2009 is identical to S. 2715 from the 110th 
Congress. It is also the same as the English amendment that passed the 
Senate in 2007 as Senate amendment No. 1151, and in 2006 as Senate 
amendment No. 4064, each being part of the Comprehensive Immigration 
Reform Act of each respective Congress. Senate amendment No. 1151 was 
agreed to in the Senate by a vote of 64 to 33. Senate amendment No. 
4064 was agreed to in the Senate by a vote of 62 to 35. As you can see, 
there is widespread and bipartisan support for this legislation, and I 
hope that you will join me this Congress in supporting the National 
Language Act of 2009.
  This is one of the few things that comes along that everyone is for. 
The lowest percentage we have from polling in the last 3 years as to 
people's acceptance of English as the national language is 87 percent. 
Interestingly enough, we even have polls showing that 71 percent of 
Hispanics would rather have English as the national language.
  It is interesting, I have been around quite a bit, around the African 
countries quite a bit. Several of the African countries, including 
Ghana in West Africa, have English as their national language. When you 
try to explain to people in the real world--when you get out of 
Washington and get back to Illinois or the State of Oklahoma, you find 
people ask the question: Why is it some 52 countries have English as 
the national language and we don't here? There is no logical reason.
  It probably enjoys a larger popularity than any amendment we have had 
in recent years. I ask that it be considered as a second-degree 
amendment to the Reid amendment.
  The PRESIDING OFFICER. The amendment is pending.
  Mr. INHOFE. I ask the Chair, at such time as we take up the Reid 
amendment, I will offer this as a second-degree amendment.
  The PRESIDING OFFICER. Amendment No. 996 has been offered.
  Mr. INHOFE. I ask unanimous consent to set aside this amendment for 
the purpose of offering an amendment to S. 386.
  The PRESIDING OFFICER. I object.
  Mr. INHOFE. I understand and appreciate that.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. VITTER. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 991

  Mr. VITTER. Mr. President, I ask unanimous consent to set aside the 
pending amendment and call up the Vitter amendment No. 991.
  The PRESIDING OFFICER. Without objection, it is so ordered. The clerk 
will report.
  The assistant legislative clerk read as follows:

       The Senator from Louisiana [Mr. Vitter] proposes an 
     amendment numbered 991.

  Mr. VITTER. Mr. President, I ask unanimous consent that the reading 
of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

(Purpose: To authorize and remove impediments to the repayment of funds 
    received under the Troubled Asset Relief Program, and for other 
                               purposes)

       At the appropriate place, insert the following:

     SEC. __. REPAYMENT OF TARP FUNDS.

       Section 111(g) of the Emergency Economic Stabilization Act 
     of 2008 (12 U.S.C. 5221(g)) is amended--
       (1) by striking ``Subject to'' and inserting the following:
       ``(1) Repayment permitted.--Subject to'';
       (2) by inserting ``if, subsequent to such repayment, the 
     TARP recipient is well capitalized (as determined by the 
     appropriate Federal banking agency having supervisory 
     authority over the TARP recipient)'' after ``waiting 
     period,'';
       (3) by striking ``, and when such assistance is repaid, the 
     Secretary shall liquidate warrants associated with such 
     assistance at the current market price''; and
       (4) by adding at the end the following:
       ``(2) No repayment precondition for warrants.--A TARP 
     recipient that exercises the repayment authority under 
     paragraph (1) shall not be required to repurchase warrants 
     from the Federal Government as a condition of repayment of 
     assistance provided under the TARP. The Secretary shall, at 
     the request of the relevant TARP recipient, repay the 
     proceeds of warrants repurchased before the date of enactment 
     of this paragraph.''.

  Mr. VITTER. Mr. President, this amendment is very simple. It is 
regarding the TARP program, and it simply allows banks that want to 
repay taxpayer dollars back to the Government, back into the program, 
to do so. It is a pretty simple idea. It only allows it if the bank is 
going to be financially stable and meet all the applicable capital 
requirements without the money. Again, it is a pretty simple idea. Yet 
this amendment is clearly necessary in order to allow banks to do that 
without having Washington bureaucrats veto that decision, which should 
rest with those private financial institutions.
  As this body knows, I have been a cynic and critic of TARP from the 
very beginning. I voted against it last year under President Bush. 
Unfortunately, many of my greatest fears about its weaknesses and how 
it would develop have come to pass. But there is one recent trend with 
regard to the program that I find enormously promising, and that trend 
is that more and more banks that got the taxpayer money want to pay it 
back, want to exit the program and have nothing more to do with it as 
soon as possible.
  I am happy to say that positive trend was begun in Louisiana. It was 
begun by a significant Louisiana bank named Iberia Bank of Lafayette 
which became the first bank in the country to try to repay its TARP 
money. Of course, the Iberia Bank did eventually get to repay

[[Page S4556]]

that money. The bank said that being a recipient of TARP funds, it 
realized, after some experience, placed it at an ``unacceptable 
competitive disadvantage.''
  I think it is very important to underscore that this was not an issue 
of executive compensation or bonuses. Iberia Bank is in Lafayette, LA, 
not Wall Street, New York City, NY. It had nobody in its structure that 
would have been limited in terms of compensation by the rules Congress 
placed with regard to that. Executive compensation wasn't the issue 
with them at all. However, they feared a couple of things. They saw the 
increasing role of government in the boardroom of banks that had 
accepted TARP money, they saw what they considered a contract with 
regard to the TARP money between the bank and the taxpayer being 
unilaterally changed by Federal bureaucrats every week, and they saw 
that as a very clear building trend. So they decided they wanted out 
because they feared they were going to be more and more hamstrung by 
Federal bureaucrats and the government growing to become their senior 
partner, rather than as the original role of a junior partner. They saw 
the government becoming more and more involved in how their bank was 
run, and they wanted out. And as they said very directly, they then 
considered having the TARP funds as an ``unacceptable competitive 
disadvantage.''
  Seven banks in all have reached that same conclusion and have been 
able to repay TARP funds to the program. That repayment has totaled 
about half a trillion. Iberia Bank of Lafayette, LA, was the first to 
start this trend, but they were followed by Bank of Maine Bankcorp, Old 
National Bankcorp, Signature Bank, Sun Bankcorp, Shore Bancshares, and 
Centra Financial Holding, Inc. All of these banks said: We want out. We 
think this is a real problem. The government is getting more and more 
into how we run our business. We want to repay and get out of the 
program. And these banks were allowed to repay TARP funds back to the 
government and withdraw from TARP.
  Mr. President, you might say: Well, if these banks were allowed to do 
it, what is the problem? The problem is that Secretary Geithner and the 
Treasury Department have made it clear that while they allowed 
repayment in those cases, they may well not allow it in other cases, 
particularly in the case of much larger institutions. Again, this is 
very clear from recent discussion and recent testimony from Secretary 
Geithner. In the last few days, Secretary Geithner has testified on 
Capitol Hill, and the main message from that testimony with regard to 
the ever evolving TARP program and how precisely it is going to be 
operated in the future is that we are not sure. We are not sure about 
guidelines for repayment. Stay tuned.
  On the one hand, the Secretary indicated a willingness to allow banks 
to repay, but at the same time, on the other hand, he indicated clearly 
that it will largely depend on the credit needs of the broader economy 
and not simply the health of that individual bank.
  Yesterday's Wall Street Journal confirmed exactly this, because it 
reported an interview with Secretary Geithner where he indicated ``that 
the health of individual banks won't be the sole criterion for whether 
financial firms will be allowed to repay bailout funds.'' So in other 
words, the Secretary is taking the position that he wants to maintain a 
veto over any repayment beyond the issue of whether that single bank, 
that particular financial institution, would be perfectly sound and 
healthy without holding on to that TARP money.
  I think that is unacceptable. I think that is offensive, in fact. 
That is a government bureaucrat saying: No, no, no, no. I know this is 
your business, but we know best. I know you have decided this is best 
for you, but we have a veto over this because of our general concerns 
about the broader economy. That is unacceptable.
  So again, we come back to my amendment--Vitter amendment No. 991--
which is necessary in light of this stance of Secretary Geithner and 
the Treasury Department. Again, my amendment is very simple. It ensures 
the immediate repayment of TARP funds for banks that want to repay, but 
only in a few circumstances. First, the government must be repaid 
everything it is owed. The government has to be repaid everything it is 
owed, although it does prohibit the government from requiring a company 
to repurchase its warrants.
  My amendment also ensures that TARP recipients be well capitalized, 
meet all the soundness and safety and capitalization liquidity 
requirements after the repayment. So my amendment wouldn't allow a 
repayment if that repayment would sink a bank to a position of not 
being well capitalized, of not meeting the normal capitalization 
liquidity requirements to ensure safety and soundness. Those 
requirements are spelled out by the regulators, as they have always 
been. So my amendment does not threaten that at all. It requires that 
those capitalization requirements be adhered to and a repayment only 
happen if the bank meets those capitalization and liquidity 
requirements after the repayment.
  I hope this amendment not only passes but gets overwhelming 
bipartisan support. After all, why shouldn't it? This amendment is 
simply saying that a private business will be in control of its own 
destiny; that a private business can pay back TARP money, with 
interest, with everything that is required to the government, if it 
decides that is the best thing for that business to do, as long as that 
repayment does not affect the safety and soundness of the institution 
and make it dip below already established guidelines with regard to 
capitalization and liquidity.
  Again, I believe this idea and this amendment should not only pass, 
it should have overwhelming bipartisan support because it seems to me 
those who oppose this amendment--presumably including Secretary 
Geithner--have to be saying one of two things, or maybe both: No. 1, 
they have to be saying, in a very arrogant way: No, we know better. No, 
you may run your business, you may be aware of all aspects of it, but 
we know better so we have to have a veto, or they have to be saying and 
acting on the basis of: We are now involved in your business. You have 
the government as a dominant partner, and we are not going to let go 
because letting go means loss of power and control as well as your 
repaying the money.
  I encourage all of our colleagues, Democrats and Republicans, to come 
together and support this very reasonable commonsense amendment. Banks 
that can afford to repay the TARP money and that want to repay the TARP 
money certainly should have the absolute unquestioned right to repay 
the TARP money. It is as simple as that. We shouldn't stand here on the 
Senate floor or in the Department of the Treasury and say: No, we know 
better. And we certainly shouldn't stand here on the Senate floor or in 
the Department of the Treasury and say: No, the government has now sunk 
its claws into you and we are not letting go. We like the control. We 
like the takeover. We like the authority and we are not giving that up.
  That is a very dangerous statement for the government to get out, and 
it is quite frankly what so many Americans are fearful of--that these 
emergency measures in the midst of the financial crisis are really a 
dramatic, long-term expansion of the authority and role of the Federal 
Government in the free market.
  With that, Mr. President, I look forward to further debate and a vote 
on this amendment tomorrow.
  I yield the floor, and I suggest the absence of a quorum.
  The PRESIDING OFFICER. Will the Senator withhold his request for a 
quorum call?
  Mr. VITTER. Certainly.
  The PRESIDING OFFICER. The Senator from California.


                           Amendment No. 1000

  Mrs. BOXER. Mr. President, I know we are waiting to see if I can send 
an amendment to the desk, and ask that the pending amendment be set 
aside. It would be my intention to do so when we can get the clearance 
on the other side.
  This is a bipartisan amendment. I think it is important that people 
understand it is with Senator Corker, Senator Snowe, and Democratic 
Senator Jeff Merkley. What we are trying to do is make sure that in the 
TARP program, when these toxic assets are sold off, there are no 
kickbacks between the seller of the asset and the private party. What 
we would

[[Page S4557]]

do is make sure that the inspector general has enough funds to go after 
that type of conflict of interest.
  Mr. President, I ask unanimous consent to set aside the pending 
amendment, and I understand the clerk has my amendment at the desk, if 
he would read it.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.
  The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from California [Mrs. Boxer], for herself, Ms. 
     Snowe, Mr. Corker, and Mr. Merkley, proposes an amendment 
     numbered 1000.

  Mrs. BOXER. Mr. President, I ask unanimous consent that the reading 
be dispensed with, because I have described it.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

(Purpose: To authorize monies for the Special Inspector General for the 
 Troubled Asset Relief Program to audit and investigate recipients of 
non-recourse Federal loans under the Public Private Investment Program 
                   and the Term Asset Loan Facility)

       On page 20, between lines 11 and 12, insert the following:
       ``(e) Additional Appropriations for the Special Inspector 
     General for the Troubled Asset Relief Program.--
       ``(1) In general.--There is authorized to be appropriated 
     to the Special Inspector General of the Troubled Asset Relief 
     Program (in this subsection referred to as the Special 
     Inspector General), $15,000,000 for fiscal year 2010.
       ``(2) Priorities.--In utilizing funds made available under 
     this subsection, the Special Inspector General shall 
     prioritize the performance of audits or investigations of 
     recipients of non-recourse Federal loans made under the 
     Public Private Investment Program established by the 
     Secretary of the Treasury or the Term Asset Loan Facility 
     established by the Board of Governors of the Federal Reserve 
     System, to the extent that such priority is consistent with 
     other aspects of the mission of the Special Inspector 
     General. Such audits or investigations shall determine the 
     existence of any collusion between the loan recipient and the 
     seller or originator of the asset used as loan collateral, or 
     any other conflict of interest that may have led the loan 
     recipient to deliberately overstate the value of the asset 
     used as loan collateral.''.

  Mrs. BOXER. Mr. President, I thank Chairman Leahy. I know he is so 
anxious to get this bill through, and it is not my intention to slow 
anything up. I do think I stand here as a former stockbroker, and I 
know we need integrity in the system, and I know that is the purpose of 
this bill, so I feel this bipartisan amendment would add quality to his 
already excellent bill.
  Mr. President, I yield the floor, and it is my understanding that my 
amendment would be pending. I ask the Presiding Officer if that is the 
case.
  The PRESIDING OFFICER. It is currently pending.
  Mrs. BOXER. I thank the Chair, and I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. BARRASSO. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BARRASSO. Mr. President, I ask to be able to speak as in morning 
business.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                          A Doomsday Solution

  Mr. BARRASSO. Mr. President, I come to the floor today because the 
Environmental Protection Agency has issued a proposal, a proposal 
finding that greenhouse gas emissions pose a danger to the public's 
health and welfare. The Washington Post has referred to this as a 
``determination that could trigger a series of sweeping regulations 
affecting everything from vehicles to coal-fired power plants.'' 
According to legal experts, the scope of these regulations could cover 
hospitals, schools, farms, commercial buildings, and even nursing 
homes.
  EPA Administrator Lisa Jackson said that the EPA was not looking for 
a doomsday solution. Well, I have news for the administrator--this is 
one. In fact, this endangerment finding, once finalized, could cover 
any source that emits more than 250 tons per year of carbon dioxide. 
This is the limit expressly mentioned in the Clean Air Act. Hospitals, 
schools, farms, commercial buildings, and nursing homes will be 
required to obtain preconstruction permits for their activities. 
Further, according to the legal scholars, the statutory language is 
mandatory and does not leave any room for the EPA to exercise 
discretion or to create exemptions.
  The economic consequences of this will be great. According to the 
U.S. Chamber of Commerce, one-fifth of all food service businesses, 
one-third of all health care businesses, one-half of the entire lodging 
industry--all of those could be covered under the scope of the Clean 
Air Act. According to the Heritage Foundation, such regulations would 
lead to job losses that would exceed 800,000 jobs. I thought this 
administration was interested in creating jobs, not killing them. But 
that is what this ruling says. The gross domestic product lost to the 
country could be $7 trillion by the year 2029.
  In short, unless Congress acts, this administration is taking an 
enormous risk, an enormous economic gamble with the future of the 
American people. It is a bad bet, with no hope for any temperature 
reductions--which is what they are trying to do.
  The EPA Administrator has stated that she wants to avoid a regulatory 
thicket. If this approach is such a bad option, let's take it off the 
table. Why would the administration deliberately leave a bad option, a 
regulatory thicket for Americans, on the table? It makes no sense. It 
is for that reason that today I have sent a letter to President Obama 
asking that he take this option off the table. He must urge the Senate 
leadership and the House leadership right here to pass legislation to 
exempt the Clean Air Act from becoming a climate change tool. It is a 
bad option for Americans, and it is no option for America.
  The Administrator of the EPA has stated that, if necessary, she is 
poised to be specific on what we regulate and on what schedule. I asked 
the EPA nominee, who will oversee the Clean Air Act, how this would be 
done. She responded that President George W. Bush's advance notice of 
proposed rulemaking laid out the options. This is the same advance 
notice of proposed rulemaking that has been so roundly criticized by 
the majority.
  I asked how the EPA would handle losing court challenges if the 
department tried to exempt farms and schools and hospitals and nursing 
homes and small businesses from the reach of the Clean Air Act. The 
nominee responded again that President Bush's rulemaking ``explored a 
number of possible ways of streamlining'' the Clean Air Act. This is 
not an answer at all. The American people need to know how they will be 
protected from the long arm of Washington.
  The EPA Administrator admits that a better option is to have Congress 
pass legislation to deal with climate change. The option on the table 
today is the President's energy tax. The President's energy tax is 
moving in the House of Representatives. It is called the American Clean 
Energy and Security Act of 2009. The President's energy tax will fund a 
trillion-dollar climate bailout scheme--a bailout scheme that will not 
reduce global temperatures by even a single degree. Moving forward with 
a $1 trillion climate bailout scheme to avoid the Clean Air Act 
regulations is the legislative equivalent of moving the American 
taxpayers from the frying pan into the fire.
  This President's cap-and-trade scheme will dramatically raise prices 
on businesses as well as on consumers. It is bad for consumers, it is 
bad for jobs, and it is bad for our economy.
  We have passed numerous bailout bills over the past 6 months. We 
passed a $787 billion stimulus package for an economic bailout intended 
to save or create jobs. This is money we have been borrowing from 
China. They have such concerns they are not so interested in lending it 
to us anymore.
  The American people already have bailout and borrowing fatigue. We 
all know our deficits are soaring. We have saddled future generations 
with this debt for years to come. I hear that when I go to the schools 
and talk to the high school students.
  Spending trillions of additional dollars to address climate change 
through an untested cap-and-trade scheme is an unnecessarily risky 
approach. It, too, is a regulatory nightmare. This approach will cost 
thousands of jobs in the very same sectors that will be hit

[[Page S4558]]

under the Clean Air Act. It is not a viable option, and it is not a 
responsible option.
  I call on the Senate leadership to expedite legislation to the 
President that takes the Clean Air Act out of the business of 
regulating the climate. Let us come together and find a solution to our 
Nation's energy needs. With all seriousness, we need all of it, we need 
all the sources of energy because we will continue to use it all. We 
need a solution that makes American energy as clean as we can, as fast 
as we can, and without hurting our economy.
  It is time for the Environmental Protection Agency to get that 
message.
  I yield the floor.
  The PRESIDING OFFICER (Mr. Bennet.) The Senator from Arizona is 
recognized.
  Mr. KYL. Mr. President, I ask unanimous consent to lay aside the 
pending amendment for the purpose of offering four amendments.
  The PRESIDING OFFICER. In my capacity as the Senator from Illinois, I 
object.


                           Amendment No. 986

  Mr. KYL. Mr. President, I will offer one amendment at this time.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. KYL. Mr. President, amendment No. 986 is at the desk. I call it 
up for its consideration.
  The PRESIDING OFFICER. The clerk will report.
  The bill clerk read as follows:

       The Senator from Arizona [Mr. Kyl] proposes an amendment 
     numbered 986.

  Mr. KYL. Mr. President, I ask unanimous consent that the reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

(Purpose: To limit the amount that may be deducted from proceeds due to 
     the United States under the False Claims Act for purposes of 
 compensating private intervenors to the greater of $50,000,000 or 300 
          percent of the expenses and costs of the intervenor)

       On page 26, after line 22, insert the following:

     SEC. 5. LIMITATION ON AWARDS TO CERTAIN INTERVENORS.

       Section 3730(d) of title 31, United States Code, is 
     amended--
       (1) in paragraph (1)--
       (A) in the first sentence, by inserting ``but in no event 
     more than the greater of $50,000,000 or 300 percent of the 
     expenses, fees, and costs awarded to such person under the 
     fourth sentence of this paragraph'' after ``prosecution of 
     the action''; and
       (B) in the second sentence--
       (i) by striking ``Government Accounting Office'' and 
     inserting ``Government Accountability Office'';
       (ii) by inserting ``but in no event more than the greater 
     of $50,000,000 or 300 percent of the expenses, fees, and 
     costs awarded to such person under the fourth sentence of 
     this paragraph'' after ``advancing the case to litigation''; 
     and
       (2) in paragraph (2), by striking the second sentence and 
     inserting ``The amount, which shall be paid out of the 
     proceeds of the action or settlement, shall be not less than 
     25 percent and not more than 30 percent of the amount of such 
     proceeds, but in no event more than the greater of 
     $50,000,000 or 300 percent of the expenses, fees, and costs 
     awarded to such person under the third sentence of this 
     paragraph''.

  Mr. KYL. I will explain. The other three amendments are precisely the 
same, except they have a different dollar amount in them. I will ask 
for their consideration later, or for their introduction at a later 
time.
  At this point, I defer to the Senator from Oklahoma if he is ready.
  The PRESIDING OFFICER. The Senator from Oklahoma is recognized.
  Mr. COBURN. Mr. President, I rise today to discuss S. 386, the Fraud 
Enforcement and Recovery Act of 2009. Although I certainly support the 
well-intended purpose of this bill, I have concerns about the proposal 
that I would like to explain today.
  S. 386 aims to ``beef up'' the Government's efforts to combat fraud, 
particularly in the mortgage industry and Federal assistance programs. 
To that end, the bill creates a host of new criminal provisions and 
authorizes nearly half a billion dollars in spending over the next 2 
years.
  As a threshold matter, I am concerned about the necessity of these 
new criminal provisions. In my mind, Congress should have a compelling 
reason for adding to the already monstrous Federal criminal code. With 
more than 4,400 Federal offenses already on the books, it is hard to 
imagine there being conduct the Government cannot reach.
  The Federal criminal code is often criticized for being overly broad, 
and legislators on both sides of the aisle have been known to bemoan 
its growth. Yet when ``tough-on-crime'' bills come before Congress, 
nobody wants to stand in their way and risk political consequences. 
This is a truly unfortunate trend.
  Turning back the tables on over-criminalization isn't a partisan 
issue. Legislators from both sides of the aisle have seen first-hand 
the sometimes devastating unintended consequences that flow from the 
application of Federal law. Democrats and Republicans could be working 
together to reevaluate some of these provisions; instead, we are doing 
business as usual, responding to every crisis by further littering the 
criminal code.
  With respect to S. 386, two prominent organizations, the National 
Association of Criminal Defense Lawyers (NACDL) and the Heritage 
Foundation, formed an unlikely alliance in opposition to the bill. Both 
organizations believe that S. 386 contributes to overcriminalization, 
and their concerns are detailed specifically in a joint letter that 
describes the new criminal proposals as ``redundant and risks 
overreaching.''It notes that within the 4,450 offenses already in 
criminal law, prosecutors have all the tools needed to reach crimes 
associated with fraud. In general, it points to the Federal mail and 
wire fraud statutes as being sufficiently broad to cover mortgage fraud 
and other related crimes. As further evidence, it references an FBI 
press release identifying nine existing Federal criminal statutes that 
can be used to prosecute mortgage fraud.
  Because it is not my intention to prevent law enforcement from 
pursuing truly criminal conduct, I studied the issue to determine 
whether there are any insufficiencies within existing law that would 
give perpetrators of fraud safe haven. I have found no examples of 
conduct or entities outside the reach of current law.
  It is true that not every provision of the criminal code reaches 
certain fraudulent acts. It is also true that not every entity in the 
mortgage industry is regulated by the Federal Government. It is not 
true, however, that the conduct or entities targeted by this bill are 
currently going unpunished. Prosecutors have successfully used other 
laws, particularly the mail and wire fraud statutes, to aggressively 
prosecute these crimes at the Federal level.
  The FBI's recent successes serve to demonstrate this point. The FBI 
has handled mortgage fraud since 1989 and is actively pursuing these 
crimes now. It has 65 mortgage fraud task forces and working groups 
across the country that coordinate federal, state and local law 
enforcement officials. The FBI has 180 agents devoted to the sector. 
They are handling more than 2,000 investigations, and have opened 734 
cases this year. In fiscal year 2008, they obtained 560 indictments/
informations and 338 convictions. Last year, one operation resulted in 
the roundup of more than 400 people accused of inflicting more than $1 
billion in losses, who were caught up in a nationwide sweep named 
Operation Malicious Mortgage.
  The Secret Service has also been working hard to combat fraud 
directed at financial institutions. It has an established network of 35 
financial crimes task forces and 24 electronic crimes task forces. The 
Secret Service also partners with U.S. Attorney's Offices across the 
country to participate in mortgage fraud working groups. In fiscal year 
2008 alone, the Secret Service indicted and arrested 5,633 individuals 
responsible for $442 million in fraud losses.
  These impressive statistics, from both the FBI and the Secret 
Service, suggest that Federal criminal law is more than sufficient to 
address crimes of fraud associated with the ongoing economic crisis.
  Federal prosecutors are not alone in pursuing mortgage fraud. Just 
last month, the New York Times ran an article saying, ``Across the 
country, attorneys general have already begun indicting dozens of loan 
processors, mortgage brokers and bank officers. Last week alone, there 
were guilty pleas in Minnesota, Delaware, North Carolina and 
Connecticut and sentences in Florida and Vermont, all stemming from 
home loan scams.'' The article gave specific examples of State actions 
being taken to address the crisis:


[[Page S4559]]


       State and local prosecutors, it seems, do not need the 
     nudge. Last week, the district attorney's office in Brooklyn 
     announced the creation of a real estate fraud unit, with 12 
     employees and a mandate to ``address the recent flood of 
     mortgage fraud cases plaguing New Yorkers.'' In late 
     February, Maryland unveiled a mortgage fraud task force, 
     bringing together 17 agencies to streamline investigations.

  As the joint letter from the Heritage Foundation and the National 
Association of Criminal Defense Lawyers correctly notes, States are the 
``primary regulators of mortgage brokers and the insurance industry.
  State governments are also closest to the people and are well-
situated to detect and prosecute these crimes. Aided by the recent 
allocation of nearly $5 billion in Federal funding for State and local 
law enforcement, states should be able to continue and enhance their 
existing efforts to pursue mortgage fraud.
  In short, both Federal and State criminal law is sufficient to combat 
mortgage and other financial fraud crimes. Congress should resist the 
temptation to overreach on this issue by enacting new criminal laws, 
and instead focus its efforts on enforcing existing law.
  Enforcing existing law, of course, requires resources. In addition to 
the significant resources already being expended by the Federal 
Government to address fraud, S. 386 authorizes $490 million for fiscal 
years 2009 and 2010. CBO has scored the bill and estimates that 
implementing it would cost the full amount over the 2010-2014 period.
  Proponents argue that the recent influx of Federal dollars into the 
economy is sure to invite fraud. I do not disagree, but this problem 
did not develop overnight. Surely Congress realized the possibility for 
fraud when it wrote these checks just months ago? Instead of taking 
time to include safeguards in the bill or otherwise ensure responsible, 
effective allocation of hard-earned taxpayer dollars, Congress rushed 
the bills out the door at break-neck speed. In doing so, Congress 
created an environment ripe for fraud.
  The answer to this problem is, of course, to ask the taxpayers to 
shoulder even more of the burden. The 111th Congress has now spent more 
than $1.5 trillion, yet it has somehow neglected to fund a priority as 
important as combating fraud. The omnibus appropriations bill, passed 
just weeks ago, only contained $10 million for the FBI to pursue 
mortgage fraud. The stimulus bill, which provided $4 billion for State 
and local law enforcement, amid nearly $1 trillion in spending, failed 
to provide any money specific to fraud enforcement. Why, when 
opportunities to address this problem arose, did Congress not do the 
right thing and prioritize the funding authorized by S. 386?
  In this time of economic crisis, Congress no longer has the luxury of 
spending money haphazardly. We must learn to set priorities and make 
sacrifices, and perhaps even think creatively about how to stretch 
limited resources to meet our needs.
  For example, the Department of Justice has access to ``unobligated 
balances,'' which are unspent dollars that have been appropriated but 
not obligated during a fiscal year. Such money is typically required to 
be returned to the U.S. Treasury, but the Justice Department has unique 
authority to retain and carry over its unobligated funds for use in the 
following year. Fiscal year 2007, DOJ had almost $2.9 billion in 
unobligated balances, and it is estimated to have had nearly $2.3 
billion at the end of fiscal year 2008, and to have $2 billion at the 
end of fiscal year 2009. This excess would be a good source of funding 
for priorities such as investigating and prosecuting mortgage fraud 
during a housing crisis.
  Moreover, the Department of Justice has become infamous for its 
wasteful spending. Last year, I released a report titled, ``Justice 
Denied: Waste & Mismanagement at the Department of Justice,'' which 
identified more than $10 billion in wasteful spending. The Justice 
Department should be required to make more responsible use of the funds 
currently within its authority before Congress entrusts it with even 
more of the taxpayers' hard-earned money.
  Unfortunately, many of the dollars wasted at the Department of 
Justice are done by way of congressional earmarks. Earmarks consume 
scarce resources and prevent experts at DOJ from allocating money to 
areas with the most pressing need. Congress should allow DOJ officials 
to reprogram existing earmarks so that higher priority needs, like 
combating mortgage fraud, can be met.
  One thing is certain, the American taxpayer has already paid too high 
a price for irresponsible governance. Continuing ``business-as-usual,'' 
by funding parochial pet projects before we take care of legitimate 
business, cannot continue.
  While I surely support the legislation's goal of addressing fraud, 
especially in the mortgage industry, I do not believe S. 386 is either 
necessary or prudent at this time of economic crisis. Our national debt 
is more than $11 trillion, and CBO recently set this year's deficit at 
$1.7 trillion, projected to rise to $1.845 trillion by year's end. I 
believe Government can and should prioritize spending to fulfill its 
responsibilities without asking more of the American people. I also 
believe that State and Federal criminal law are sufficient to address 
fraud and would father see efforts focused on enforcing those existing 
laws, rather than on creating new ones.


                           Amendment No. 982

  Mr. COBURN. I ask unanimous consent that the pending amendment be set 
aside and amendment No. 982 be called up.
  The PRESIDING OFFICER. Without objection, it is so ordered. The clerk 
will report.
  The bill clerk read as follows:

       The Senator from Oklahoma [Mr. Coburn] proposes an 
     amendment numbered 982.

  Mr. COBURN. Mr. President, I ask unanimous consent that the reading 
of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

(Purpose: To authorize the use of TARP funds to cover the costs of the 
                                 bill)

       At the end of the bill, add the following:

     SEC. 5. USE OF TARP FUNDS TO PAY FOR ADDITIONAL EXPENDITURES.

       Effective upon the date of enactment of this Act, of the 
     amounts of authority made available pursuant to paragraphs 
     (1) and (2) of section 115(a) of the Emergency Economic 
     Stabilization Act of 2008 (Public Law 110-343) to purchase 
     troubled assets that remain unused as of such date of 
     enactment, such amounts as may be necessary shall be 
     available, notwithstanding any provision of such Act, to 
     provide the amounts authorized under subsections (a), (b), 
     (c), and (d) of section 3.

  Mr. COBURN. Earlier today, I spoke for a short period of time on this 
bill. I wish to retrace some of that before I talk about this 
amendment. It is important that the American people understand what 
this bill is doing.
  All of us wish to get rid of the fraud, the money laundering, we wish 
to punish the people who have, in fact, helped cause part of this 
problem. I would tell you the biggest person or group of people 
responsible for the problem we face today is the Congress, this body 
and the House of Representatives.
  We failed to do our job on oversight. We incentivized and socialized 
housing, we incentivized Fannie Mae and Freddie Mac to do things that 
were inappropriate, to take risks they should not have done, and then 
we did not have the regulatory mechanisms in place, nor did we do the 
oversight to see what was going on.
  This bill, however, is attempting to fix a problem with a statute, 
criminal statute. Most people know we do not need more criminal 
statutes. The fact is, nobody can name an act that occurred on any of 
this fraud or any of this money laundering that is not prosecutable 
under the Criminal Code we have today.
  Off the record, when we asked some pertinent people from the Justice 
Department, they laughed when asked if we needed these new criminal 
statutes. The other point I would make is, none of this, with the 
exception of the false claim portion, has any application to what has 
already happened because you cannot apply a new law to a crime that 
already existed under our Constitution.
  So what are we doing? What we are doing is trying to make the 
American public think we are doing something now that, in essence, does 
not need to be done. We may need to fund the Justice Department at a 
greater level because we did not do what we should have done earlier.
  It is the typical knee-jerk reaction. We have plenty of laws on the 
books. As a matter of fact, the new penalties in some of this stuff are 
greater for fraud and mortgage than for manslaughter under the Federal 
Code.

[[Page S4560]]

  We need to be very careful as we approach this. I am not saying we 
should not go after all those people. I am not saying we should not put 
in the resources to do that. But when we put the resource there, we 
ought to make sure they are used just for that.
  No. 2, we ought to look at the Justice Department and how they spend 
money. Late last year I released a report on the $10 billion worth of 
waste in the Justice Department over the previous 5 years, $10 billion 
that was wasted over the previous 5 years.
  Nobody disputed it. I mean, the Justice Department did not even 
answer it and say, that is not right, because they knew it was right. 
The fact is we refuse to make priorities.
  This amendment is very simple. If we are going to appropriate a half 
billion dollars in increased funding to go after the fraud and money 
laundering associated with this financial situation that the Congress 
created and incentivized individuals, should we take it from the 
American taxpayers or should we take it out of money that we have 
already allocated?
  The Justice Department is different than every other agency in the 
Federal Government, because at the end of the year, every other 
department's unexpended balances, unobligated balances eventually 
filter back to the Treasury. Not so at the Justice Department. They 
actually get to keep theirs. They are the only agency that gets to keep 
it.
  Now, what have they averaged over the last 5 years in unobligated and 
unexpended balances? Over $2 billion a year. So here is an agency with 
$2 billion that they have not spent, and we are going to give them 
another $500 million, and their incentive is not to spend the money on 
the things we need to do; it is to keep it to do with what they want 
out of the direction of those that control the purse strings.
  What this amendment says is we have already allocated money in terms 
of TARP funds; that if, in fact, we are going to send more money, which 
I do not think we should--I think we ought to spend it from the money 
we have--but if we are going to do it, let's take it from the money we 
have already taken from the American taxpayer, and it is not the 
American taxpayer; it is their grandkids, and let us use some of that 
money because the return on that money will be far greater than the 
return we are going to get on any TARP money.
  It is very simple, very straightforward as a funding treatment. What 
we will use is money that has already been appropriated in the TARP 
funds, which they have a significant balance--in the billions--and we 
will take, over the next 2 years, $250 million or so to give to the 
Justice Department, if we agree we should be giving it to the Justice 
Department. Do not be fooled by the typical Washington turnaround that 
happens all the time up here, the sleight of hand that says: We are 
fixing a problem. We tend to fix problems that are not broken and not 
fix the problems that are broken. The mess we are in demonstrates that 
very straight forwardly.
  We are going to have a $2 trillion deficit this year. We are going to 
double the national debt in 5 years. We are going to triple it in 10 
under the Obama budget. Should not we be about priorities? Should not 
we be about holding the agencies accountable? Should not we be about 
making sure the money is spent properly?
  If we are going to spend new money, try to get it from areas we 
already are not spending the money in but it has been appropriated. The 
American people would agree with that. I hope my colleagues will as 
well.
  Mr. DODD. Mr. President, let me begin by complimenting the authors of 
the bill before the Senate today. The Fraud Enforcement and Recovery 
Act, or FERA, provides important tools to the Departments of Justice, 
Homeland Security and Housing and Urban Development to investigate and 
prosecute mortgage fraud. I am afraid that our government must be 
particularly vigilant today, as criminals seek to exploit people's 
economic hardships, and as some persons harmed by the downturn resort 
to fraud as a desperate measure.
  This problem is grave, and it is getting worse by the day. Last year, 
financial institutions reported that mortgage loan fraud increased by 
44 percent from the previous year. And this year, mortgage loan fraud 
is reportedly increasing even more--26 percent over last year. And 
still, disappointingly, many incidents of fraud go unnoticed. While 
this bill appropriately addresses the problem by providing additional 
resources to bring criminals to justice, including 400 new prosecutors 
and agents, I believe that efforts to arrest this alarming trend must 
also focus on preventing frauds from even being perpetrated in the 
first place.
  Fortunately, the Obama administration is doing just that. Earlier 
this month, a new initiative was announced targeting mortgage loan 
modification fraud and foreclosure rescue scams. This effort, led by 
the Department of the Treasury's Financial Crimes Enforcement and 
Network, or FinCEN, is coordinating efforts across Federal and State 
governments as well as the private sector to share intelligence and 
identify criminal enterprises and deceptive schemes. Once such scams 
were identified, FinCEN is issuing ``early warnings'' to law 
enforcement, regulatory agencies, and the consumer protection community 
to watch for tell-tale signs of such scams. Already, FinCEN reports 
that this information is providing critical leads to protect consumers 
from falling victim to fraud. In addition, FinCEN is helping private 
industry perform their own due diligence, issuing advisories to alert 
financial institutions to the risks of emerging schemes by describing 
what they call ``red flags,'' that typify loan modification or 
foreclosure rescue scams. Banks, in turn are thus advised on how to 
file suspicious activity reports to Treasury, to ensure that law 
enforcement authorities may stay up-to-date in tracking potential fraud 
activity.
  As the industry publication, American Banker, reported last week, 
increases in the filing of suspicious activity reports this year may be 
demonstrating a rise in fraud. In any case, in my estimation, these 
filings indicate that cases of fraud are being taken very seriously 
both by the government and industry. For that reason, I believe that, 
if implemented appropriately, the FinCEN-led Foreclosure Rescue Scams & 
Loan Modification effort will help both law enforcement combat fraud 
and consumers avoid scams.
  I appreciate the Obama administration's efforts, and I urge every law 
enforcement agency, including the Department of Justice, to coordinate 
with FinCEN as we attempt to safeguard our financial system from fraud 
and prosecute those who break the law. I support the bill currently 
before the Senate, which I believe will greatly complement Treasury's 
programs to combat financial crimes.


                         Anti-Money Laundering

  Mr. LEVIN. Mr. President, as chairman of the Permanent Subcommittee 
on Investigations, I have conducted a series of hearings and issued 
reports on various issues pertaining to money-laundering and tax 
havens, and I appreciate the benefit of the Banking Committee 
chairman's insight on these matters.
  The Fraud Enforcement and Recovery Act of 2009 before us importantly 
modifies the money laundering statute to include tax evasion. I believe 
that we should also expand anti-money laundering laws to apply to other 
entities involved in financial transactions.
  In particular, hedge funds, other private investment vehicles, and 
company formation agents are not subject to the same anti-money 
laundering regulations as others who play roles in the financial 
services world. Currently, unregistered investment companies, such as 
hedge funds and private equity funds, have limited responsibilities 
under the Bank Secrecy Act. For example, hedge funds themselves are not 
required to establish Know Your Customer programs or file suspicious 
activity reports. Suspicious activity and tax evasion by clients may go 
unnoticed by appropriate authorities. Indeed, offshore tax abuses cost 
the U.S. Treasury an estimated $100 billion each year.
  Complicating the Government's ability to establish and enforce AML 
regulations for this industry is the fact that many private investment 
funds and company formation agents have largely escaped general 
regulatory oversight. For example, when the Securities and Exchange 
Commission attempted to require hedge funds to register, the Court of 
Appeals for the District of Columbia Circuit found that

[[Page S4561]]

the SEC, lacked the appropriate authority. I believe that the SEC's 
attempts were well-intentioned, but the court's findings indicate that 
clearer authority must be established for key sectors of the financial 
services industry, including hedge funds and company formation agents.
  Because hedge funds, private equity funds, and company formation 
agents are as vulnerable as other financial institutions to money 
launderers seeking entry into the U.S. financial system, there is no 
reason why they should continue to serve as pathways into the U.S. 
financial system for substantial funds of unknown origin. We need to 
establish a clear statutory mandate for these entities to implement 
sound anti-money laundering programs and to report on suspicious 
activities.
  Mr. DODD. I appreciate Senator Levin's and his subcommittee's hard 
investigative work on this very difficult subject matter. I share his 
conviction that America's regulatory system must be reformed to address 
challenges posed by business practices surrounding 21st century 
financial products. The United States cannot afford to have investment 
vehicles used to engage in abusive practices of fraud, illicit 
activity, and tax evasion. As the Banking Committee undertakes a 
comprehensive effort to modernize the securities and banking system, I 
will look forward to engaging the senior Senator from Michigan on 
issues of particular importance to him, including anti-money laundering 
measures.
  Mr. REID. Mr. President, this housing crisis is the root of our 
larger economic crisis. As the mortgage mess rapidly worsens--and 
hurting more hardworking families--the implications for every other 
part of our economy are disastrous.
  Today we learned that the number of American families at risk of 
losing their homes skyrocketed in the past few months. The problem is 
significantly worse at the beginning of this year than it was at the 
same time last year. In Las Vegas alone, 1 in every 22 homes received a 
foreclosure notice between January and March. That's seven times the 
national average.
  The American people know we must do more. The people of Nevada 
certainly know this--families in my State lose their homes at the worst 
rate in the Nation. They know we must act now, before this emergency 
spins even further out of control.
  But the declining health of our housing market comes with serious 
side effects. As foreclosures rise, so do reports of fraud. According 
to one report, the Nevada Bureau of Consumer Protection now receives 
100 complaints each month from homeowners identifying possible mortgage 
scams. One Nevada scam recently offered a 100-percent money-back 
guarantee. The scammer, unsurprisingly, didn't hold up his end of the 
bargain. Another scheme charged homeowners heavy upfront fee and 
monthly charges on top of that--only later did they learn they were not 
getting any services in return.
  While we are working to help the millions of desperate homeowners who 
need to modify their mortgages, countless swindlers are working to take 
advantage of them. And the way the system works now, we can't keep up.
  The mortgage and corporate fraud bill will strengthen our ability to 
stop those who game the system on the backs of families who play by the 
rules and make an honest living. It gives law enforcement the necessary 
tools to probe, prosecute, and punish those responsible for the frauds 
that exploit hardworking homeowners and endanger our economy.
  It is a strong start to solving a critical component of this crisis. 
But if we are going to protect families, it is not enough to punish the 
perpetrators--we must also stop the scams before they start. That is 
what the amendment I have submitted today does.
  My Amendment No. 984 complements the larger effort in the underlying 
bill in three important ways, with each component focusing on the areas 
where foreclosures are the highest:
  First, we will authorize more resources for advertising to help 
people avoid the mortgage rescue scams that bilk homeowners of 
thousands of dollars by raising awareness of the problem and 
encouraging the use of legitimate, free counseling agencies there to 
help. Because many of these areas have large Latino populations, at 
least half of those resources will be used for Spanish language 
advertising.
  Second, we will increase resources for HUD-certified housing-
counseling agencies in those hardest-hit areas. Las Vegas, Reno and 
other reeling regions still need more help as this problem gets worse. 
This amendment will help the agencies staff up and meet the growing 
demand for their services.
  Third, we will send well-trained and experienced HUD officials to 
further support those agencies and other efforts by the Federal 
Government to combat the foreclosure crisis and prevent scams.
  Hardworking Americans have lost enough in this storm. They need not 
give thousands of dollars to con artists who will leave them with 
struggling with the same mortgage and even less money to pay it. They 
need not be duped into turning over the keys to their home only to be 
evicted later.
  To stabilize the economy, we must build on the administration's and 
our own prior efforts to stabilize the housing market. To do that, we 
must start by stopping fraud. Yes, we must put away the swindlers, but 
we must also do more to stop the vultures before they can prey on the 
most vulnerable.
  I yield the floor and I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. BEGICH. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 999

  Mr. BEGICH. Mr. President, I ask unanimous consent that the order 
with respect to a vote in relation to amendment No. 999 be vitiated, 
that the amendment be agreed to, and the motion to reconsider be laid 
upon the table.
  The PRESIDING OFFICER. Is there objection?
  Without objection, the amendment is agreed to.
  The amendment (No. 999) was agreed to.
  The PRESIDING OFFICER. The motion to reconsider is laid upon the 
table.

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