[Congressional Record Volume 156, Number 59 (Monday, April 26, 2010)]
[Senate]
[Pages S2643-S2654]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS
By Mr. ENZI (for himself and Ms. Landrieu):
S. 3257. A bill to authorize the Department of Labor's voluntary
protection program and to expand the program to include more small
businesses; to the Committee on Health, Education, Labor, and Pensions.
Mr. ENZI. Mr. President, I rise today to introduce legislation with
Senator Landrieu known as the Voluntary Protection Program Act. This
bill will codify the Voluntary Protection Program, or VPP, expand it to
include more small businesses, and incorporate recent GAO
recommendations for program improvements.
No program has been more successful in creating such a culture of
safety in the workplace than VPP. Since it was created in 1982,
Republican and Democrat administrations alike have fostered its growth
to now 2,284 worksites, a quarter of which are unionized, and it covers
almost a million employees. The bipartisan support for VPP continues
into this Congress. Last week, the Senate Budget Committee unanimously
approved an amendment to preserve VPP budget authority and Chairman
Conrad noted that the program actually saves taxpayer dollars.
[[Page S2644]]
Worksites that pass the rigorous evaluation process and become VPP
sites have an average Days Away Restricted or Transferred, DART, case
rate of 52 percent below the average for its industry. In recent years,
smaller worksites have made significant strides in VPP, increasing from
28 percent of VPP sites in 2003 to 39 percent in 2008.
The innovative program doesn't just keep employees safer; as I have
noted, it also saves both the VPP companies and the taxpayers money. In
2007, Federal Agency VPP participants saved the government more than
$59 million by avoiding injuries and private sector VPP participants
saved more than $300 million. Additionally, when workplaces make the
significant commitment to safety required by VPP, it allows OSHA to
focus its resources where they are most needed. VPP Participant
employers contribute a great deal to the VPP program expenditures. VPP
participants have assigned approximately 1,200 of their own employees
to act as OSHA Special Government Employees, SGEs, who conduct onsite
evaluations for OSHA.
Despite the strong bipartisan support for VPP and its very positive
results, the need for this legislation has become painfully clear. The
administration's fiscal year 2011 Budget Request proposed eliminating
the small amount it takes to administer VPP--$3.125 million and sought
to transfer the 35 FTEs it takes to run the program to other functions.
The budget proposal stated that OSHA was seeking ``alternative non-
federal forms of funding'' and working closely with stakeholders, but,
to date, no plan to secure such funding has been offered by the
administration or in either the House or Senate authorizing committee.
To the extent such ``alternative funding'' is bureaucratic code for a
fee-based system such a proposal is simply not workable and completely
counterproductive. Participating employers already voluntarily absorb
significant costs to participate in the current program. Asking
businesses--particularly small businesses, and particularly in the
current economic environment--to take on more costs will only result in
them dropping out of the program. Further still, a fee-based system
simply destroys the credibility and integrity of VPP participation for
employees.
I would like to thank Senator Landrieu for working with me on this
important legislation.
______
By Mr. REED:
S. 3258. A bill to amend the securities laws to modernize and
strengthen investor protection, and for other purposes; to the
Committee on Banking, Housing, and Urban Affairs.
Mr. REED. Mr. President, the recent lawsuit by the Securities and
Exchange Commission, SEC, against Goldman Sachs underscores that much
still needs to be done to improve transparency and restore confidence
in our financial system. Indeed, that is why we must have the debate on
Wall Street reform. The nearly \1/2\ of all U.S. households that own
securities deserve a strong cop on the beat that has the tools it needs
to go after swindlers and scam artists, and pursue the difficult cases
arising from our increasingly complex financial markets. Our economy's
success depends in no small part on restoring confidence in our capital
markets and a smoothly operating capital formation process.
The bill I am introducing this afternoon, the Modernizing and
Strengthening Investor Protection Act, would improve the ability of the
SEC to protect investors by strengthening its ability to bring
enforcement actions, addressing issues revealed by the recent Madoff
fraud, and modernizing its ability to obtain critical information. In
particular, it would enhance the ability of the SEC to hire market
experts, strengthen oversight of fund custodians, modernize the SEC's
ability to obtain information from the firms it oversees, and clarify
and enhance SEC penalties and other authorities.
This legislation mirrors a bill that Representative Kanjorski
introduced and worked to include in the House version of Wall Street
reform. I urge my colleagues to take a look at my legislation during
the next few days, as I plan to introduce it as an amendment to the
Wall Street reform bill that is about to be considered by the Senate.
Mr. President, I ask unanimous consent that the text of the bill be
printed in the Record.
There being no objection, the text of the bill was ordered to be
printed in the Record, as follows:
S. 3258
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Modernizing and
Strengthening Investor Protection Act of 2010''.
SEC. 2. STRENGTHENING ENFORCEMENT BY THE COMMISSION.
(a) Nationwide Service of Subpoenas.--
(1) Securities act of 1933.--Section 22(a) of the
Securities Act of 1933 (15 U.S.C. 77v(a)) is amended by
inserting after the second sentence the following: ``In any
action or proceeding instituted by the Commission under this
title in a United States district court for any judicial
district, a subpoena issued to compel the attendance of a
witness or the production of documents or tangible things (or
both) at a hearing or trial may be served at any place within
the United States. Rule 45(c)(3)(A)(ii) of the Federal Rules
of Civil Procedure shall not apply to a subpoena issued under
the preceding sentence.''.
(2) Securities exchange act of 1934.--Section 27 of the
Securities Exchange Act of 1934 (15 U.S.C. 78aa) is amended
by inserting after the third sentence the following: ``In any
action or proceeding instituted by the Commission under this
title in a United States district court for any judicial
district, a subpoena issued to compel the attendance of a
witness or the production of documents or tangible things (or
both) at a hearing or trial may be served at any place within
the United States. Rule 45(c)(3)(A)(ii) of the Federal Rules
of Civil Procedure shall not apply to a subpoena issued under
the preceding sentence.''.
(3) Investment company act of 1940.--Section 44 of the
Investment Company Act of 1940 (15 U.S.C. 80a-43) is amended
by inserting after the fourth sentence the following: ``In
any action or proceeding instituted by the Commission under
this title in a United States district court for any judicial
district, a subpoena issued to compel the attendance of a
witness or the production of documents or tangible things (or
both) at a hearing or trial may be served at any place within
the United States. Rule 45(c)(3)(A)(ii) of the Federal Rules
of Civil Procedure shall not apply to a subpoena issued under
the preceding sentence.''.
(4) Investment advisers act of 1940.--Section 214 of the
Investment Advisers Act of 1940 (15 U.S.C. 80b-14) is amended
by inserting after the third sentence the following: ``In any
action or proceeding instituted by the Commission under this
title in a United States district court for any judicial
district, a subpoena issued to compel the attendance of a
witness or the production of documents or tangible things (or
both) at a hearing or trial may be served at any place within
the United States. Rule 45(c)(3)(A)(ii) of the Federal Rules
of Civil Procedure shall not apply to a subpoena issued under
the preceding sentence.''.
(b) Authority to Impose Civil Penalties in Cease and Desist
Proceedings.--
(1) Under the securities act of 1933.--Section 8A of the
Securities Act of 1933 (15 U.S.C. 77h-1) is amended by adding
at the end the following new subsection:
``(g) Authority to Impose Money Penalties.--
``(1) Grounds.--In any cease-and-desist proceeding under
subsection (a), the Commission may impose a civil penalty on
a person if the Commission finds, on the record, after notice
and opportunity for hearing, that--
``(A) such person--
``(i) is violating or has violated any provision of this
title, or any rule or regulation issued under this title; or
``(ii) is or was a cause of the violation of any provision
of this title, or any rule or regulation thereunder; and
``(B) such penalty is in the public interest.
``(2) Maximum amount of penalty.--
``(A) First tier.--The maximum amount of a penalty for each
act or omission described in paragraph (1) shall be $7,500
for a natural person or $75,000 for any other person.
``(B) Second tier.--Notwithstanding subparagraph (A), the
maximum amount of penalty for each such act or omission shall
be $75,000 for a natural person or $375,000 for any other
person, if the act or omission described in paragraph (1)
involved fraud, deceit, manipulation, or deliberate or
reckless disregard of a regulatory requirement.
``(C) Third tier.--Notwithstanding subparagraphs (A) and
(B), the maximum amount of penalty for each such act or
omission shall be $150,000 for a natural person or $725,000
for any other person, if--
``(i) the act or omission described in paragraph (1)
involved fraud, deceit, manipulation, or deliberate or
reckless disregard of a regulatory requirement; and
``(ii) such act or omission directly or indirectly resulted
in--
``(I) substantial losses or created a significant risk of
substantial losses to other persons; or
``(II) substantial pecuniary gain to the person who
committed the act or omission.
``(3) Evidence concerning ability to pay.--In any
proceeding in which the Commission may impose a penalty under
this section, a respondent may present evidence
[[Page S2645]]
of the ability of the respondent to pay such penalty. The
Commission may, in its discretion, consider such evidence in
determining whether such penalty is in the public interest.
Such evidence may relate to the extent of the ability of the
respondent to continue in business and the collectability of
a penalty, taking into account any other claims of the United
States or third parties upon the assets of the respondent and
the amount of the assets of the respondent.''.
(2) Under the securities exchange act of 1934.--Section
21B(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78u-
2(a)) is amended--
(A) by striking the matter immediately following paragraph
(4);
(B) in the matter preceding paragraph (1), by inserting
after ``opportunity for hearing,'' the following: ``that such
penalty is in the public interest and'';
(C) by redesignating paragraphs (1) through (4) as
subparagraphs (A) through (D), respectively, and adjusting
the subparagraph margins accordingly;
(D) by striking ``In any proceeding'' and inserting the
following:
``(1) In general.--In any proceeding''; and
(E) by adding at the end the following:
``(2) Cease-and-desist proceedings.--In any proceeding
instituted under section 21C against any person, the
Commission may impose a civil penalty, if the Commission
finds, on the record after notice and opportunity for
hearing, that such person--
``(A) is violating or has violated any provision of this
title, or any rule or regulation issued under this title; or
``(B) is or was a cause of the violation of any provision
of this title, or any rule or regulation issued under this
title.''.
(3) Under the investment company act of 1940.--Section
9(d)(1) of the Investment Company Act of 1940 (15 U.S.C. 80a-
9(d)(1)) is amended--
(A) by striking the matter immediately following
subparagraph (C);
(B) in the matter preceding subparagraph (A), by inserting
after ``opportunity for hearing,'' the following: ``that such
penalty is in the public interest, and'';
(C) by redesignating subparagraphs (A) through (C) as
clauses (i) through (iii), respectively, and adjusting the
clause margins accordingly;
(D) by striking ``In any proceeding'' and inserting the
following:
``(A) In general.--In any proceeding''; and
(E) by adding at the end the following:
``(B) Cease-and-desist proceedings.--In any proceeding
instituted pursuant to subsection (f) against any person, the
Commission may impose a civil penalty if the Commission
finds, on the record, after notice and opportunity for
hearing, that such person--
``(i) is violating or has violated any provision of this
title, or any rule or regulation issued under this title; or
``(ii) is or was a cause of the violation of any provision
of this title, or any rule or regulation issued under this
title.''.
(4) Under the investment advisers act of 1940.--Section
203(i)(1) of the Investment Advisers Act of 1940 (15 U.S.C.
80b-3(i)(1)) is amended--
(A) by striking the undesignated matter immediately
following subparagraph (D);
(B) in the matter preceding subparagraph (A), by inserting
after ``opportunity for hearing,'' the following: ``that such
penalty is in the public interest and'';
(C) by redesignating subparagraphs (A) through (D) as
clauses (i) through (iv), respectively, and adjusting the
clause margins accordingly;
(D) by striking ``In any proceeding'' and inserting the
following:
``(A) In general.--In any proceeding''; and
(E) by adding at the end the following new subparagraph:
``(B) Cease-and-desist proceedings.--In any proceeding
instituted pursuant to subsection (k) against any person, the
Commission may impose a civil penalty if the Commission
finds, on the record, after notice and opportunity for
hearing, that such person--
``(i) is violating or has violated any provision of this
title, or any rule or regulation issued under this title; or
``(ii) is or was a cause of the violation of any provision
of this title, or any rule or regulation issued under this
title.''.
(c) Formerly Associated Persons.--
(1) Member or employee of the municipal securities
rulemaking board.--Section 15B(c)(8) of the Securities
Exchange Act of 1934 (15 U.S.C. 78o-4(c)(8)) is amended by
striking ``any member or employee'' and inserting ``any
person who is, or at the time of the alleged violation or
abuse was, a member or employee''.
(2) Person associated with a government securities broker
or dealer.--Section 15C(c) of the Securities Exchange Act of
1934 (15 U.S.C. 78o-5(c)) is amended--
(A) in paragraph (1)(C), by striking ``any person
associated, or seeking to become associated,'' and inserting
``any person who is, or at the time of the alleged misconduct
was, associated or seeking to become associated''; and
(B) in paragraph (2)--
(i) in subparagraph (A), by inserting ``, seeking to become
associated, or, at the time of the alleged misconduct,
associated or seeking to become associated'' after ``any
person associated''; and
(ii) in subparagraph (B), by inserting ``, seeking to
become associated, or, at the time of the alleged misconduct,
associated or seeking to become associated'' after ``any
person associated''.
(3) Person associated with a member of a national
securities exchange or registered securities association.--
Section 21(a)(1) of the Securities Exchange Act of 1934 (15
U.S.C. 78u(a)(1)) is amended, in the first sentence, by
inserting ``, or, as to any act or practice, or omission to
act, while associated with a member, formerly associated''
after ``member or a person associated''.
(4) Participant of a registered clearing agency.--Section
21(a)(1) of the Securities Exchange Act of 1934 (15 U.S.C.
78u(a)(1)) is amended, in the first sentence, by inserting
``or, as to any act or practice, or omission to act, while a
participant, was a participant,'' after ``in which such
person is a participant,''.
(5) Officer or director of a self-regulatory
organization.--Section 19(h)(4) of the Securities Exchange
Act of 1934 (15 U.S.C. 78s(h)(4)) is amended--
(A) by striking ``any officer or director'' and inserting
``any person who is, or at the time of the alleged misconduct
was, an officer or director''; and
(B) by striking ``such officer or director'' and inserting
``such person''.
(6) Officer or director of an investment company.--Section
36(a) of the Investment Company Act of 1940 (15 U.S.C. 80a-
35(a)) is amended--
(A) by striking ``a person serving or acting'' and
inserting ``a person who is, or at the time of the alleged
misconduct was, serving or acting''; and
(B) by striking ``such person so serves or acts'' and
inserting ``such person so serves or acts, or at the time of
the alleged misconduct, so served or acted''.
(7) Person associated with a public accounting firm.--
(A) Sarbanes-oxley act of 2002 amendment.--Section 2(a)(9)
of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7201(9)) is
amended by adding at the end the following:
``(C) Investigative and enforcement authority.--For
purposes of sections 3(c), 101(c), 105, and 107(c) and the
rules of the Board and Commission issued thereunder, except
to the extent specifically excepted by such rules, the terms
defined in subparagraph (A) shall include any person
associated, seeking to become associated, or formerly
associated with a public accounting firm, except that--
``(i) the authority to conduct an investigation of such
person under section 105(b) shall apply only with respect to
any act or practice, or omission to act, by the person while
such person was associated or seeking to become associated
with a registered public accounting firm; and
``(ii) the authority to commence a disciplinary proceeding
under section 105(c)(1), or impose sanctions under section
105(c)(4), against such person shall apply only with respect
to--
``(I) conduct occurring while such person was associated or
seeking to become associated with a registered public
accounting firm; or
``(II) non-cooperation, as described in section 105(b)(3),
with respect to a demand in a Board investigation for
testimony, documents, or other information relating to a
period when such person was associated or seeking to become
associated with a registered public accounting firm.''.
(B) Securities exchange act of 1934 amendment.--Section
21(a)(1) of the Securities Exchange Act of 1934 (15 U.S.C.
78u(a)(1)) is amended by striking ``or a person associated
with such a firm'' and inserting ``, a person associated with
such a firm, or, as to any act, practice, or omission to act,
while associated with such firm, a person formerly associated
with such a firm''.
(8) Supervisory personnel of an audit firm.--Section
105(c)(6) of the Sarbanes-Oxley Act of 2002 (15 U.S.C.
7215(c)(6)) is amended--
(A) in subparagraph (A), by striking ``the supervisory
personnel'' and inserting ``any person who is, or at the time
of the alleged failure reasonably to supervise was, a
supervisory person''; and
(B) in subparagraph (B)--
(i) by striking ``No associated person'' and inserting ``No
current or former supervisory person''; and
(ii) by striking ``any other person'' and inserting ``any
associated person''.
(9) Member of the public company accounting oversight
board.--Section 107(d)(3) of the Sarbanes-Oxley Act of 2002
(15 U.S.C. 7217(d)(3)) is amended by striking ``any member''
and inserting ``any person who is, or at the time of the
alleged misconduct was, a member''.
(d) Extraterritorial Jurisdiction of the Antifraud
Provisions of the Federal Securities Laws.--
(1) Under the securities act of 1933.--Section 22 of the
Securities Act of 1933 (15 U.S.C. 77v(a)) is amended by
adding at the end the following new subsection:
``(c) Extraterritorial Jurisdiction.--The district courts
of the United States and the United States courts of any
Territory shall have jurisdiction of an action or proceeding
brought or instituted by the Commission or the United States
alleging a violation of section 17(a) involving--
``(1) conduct within the United States that constitutes
significant steps in furtherance of the violation, even if
the securities transaction occurs outside the United States
and involves only foreign investors; or
``(2) conduct occurring outside the United States that has
a foreseeable substantial effect within the United States.''.
[[Page S2646]]
(2) Under the securities exchange act of 1934.--Section 27
of the Securities Exchange Act of 1934 (15 U.S.C. 78aa) is
amended--
(A) by striking ``The district'' and inserting the
following:
``(a) In General.--The district''; and
(B) by adding at the end the following new subsection:
``(b) Extraterritorial Jurisdiction.--The district courts
of the United States and the United States courts of any
Territory shall have jurisdiction of an action or proceeding
brought or instituted by the Commission or the United States
alleging a violation of the antifraud provisions of this
title involving--
``(1) conduct within the United States that constitutes
significant steps in furtherance of the violation, even if
the securities transaction occurs outside the United States
and involves only foreign investors; or
``(2) conduct occurring outside the United States that has
a foreseeable substantial effect within the United States.''.
(3) Under the investment advisers act of 1940.--Section 214
of the Investment Advisers Act of 1940 (15 U.S.C. 80b-14) is
amended--
(A) by striking ``The district'' and inserting the
following:
``(a) In General.--The district''; and
(B) by adding at the end the following new subsection:
``(b) Extraterritorial Jurisdiction.--The district courts
of the United States and the United States courts of any
Territory shall have jurisdiction of an action or proceeding
brought or instituted by the Commission or the United States
alleging a violation of section 206 involving--
``(1) conduct within the United States that constitutes
significant steps in furtherance of the violation, even if
the violation is committed by a foreign adviser and involves
only foreign investors; or
``(2) conduct occurring outside the United States that has
a foreseeable substantial effect within the United States.''.
(e) Control Person Liability Under the Securities Exchange
Act of 1934.--Section 20(a) of the Securities Exchange Act of
1934 (15 U.S.C. 78t(a)) is amended by inserting after
``controlled person is liable'' the following: ``(including
to the Commission in any action brought under paragraph (1)
or (3) of section 21(d))''.
(f) Aiding and Abetting Under the Securities Laws.--
(1) Under the securities act of 1933.--Section 15 of the
Securities Act of 1933 (15 U.S.C. 77o) is amended--
(A) by striking ``Every person who'' and inserting ``(a)
Controlling Persons.--Every person who''; and
(B) by adding at the end the following:
``(b) Prosecution of Persons Who Aid and Abet Violations.--
For purposes of any action brought by the Commission under
subparagraph (b) or (d) of section 20, any person that
knowingly or recklessly provides substantial assistance to
another person in violation of a provision of this Act, or of
any rule or regulation issued under this Act, shall be deemed
to be in violation of such provision to the same extent as
the person to whom such assistance is provided.''.
(2) Under the investment company act of 1940.--Section 48
of the Investment Company Act of 1940 (15 U.S.C. 80a-48) is
amended by redesignating subsection (b) as subsection (c) and
inserting after subsection (a) the following:
``(b) For purposes of any action brought by the Commission
under subsection (d) or (e) of section 42, any person that
knowingly or recklessly provides substantial assistance to
another person in violation of a provision of this Act, or of
any rule or regulation issued under this Act, shall be deemed
to be in violation of such provision to the same extent as
the person to whom such assistance is provided.''.
(3) Under the investment advisers act.--Section 209 of the
Investment Advisers Act of 1940 (15 U.S.C. 80b-9) is amended
by inserting at the end the following new subsection:
``(f) Aiding and Abetting.--For purposes of any action
brought by the Commission under subsection (e), any person
that knowingly or recklessly has aided, abetted, counseled,
commanded, induced, or procured a violation of any provision
of this Act, or of any rule, regulation, or order hereunder,
shall be deemed to be in violation of such provision, rule,
regulation, or order to the same extent as the person that
committed such violation.''.
(4) Under the securities exchange act of 1934.--Section
20(e) of the Securities Exchange Act of 1934 (15 U.S.C.
78t(e)) is amended by inserting ``or recklessly'' after
``knowingly''.
SEC. 3. ADDRESSING ISSUES REVEALED BY THE MADOFF FRAUD.
(a) Revision to Recordkeeping Rule.--
(1) Investment company act of 1940 amendments.--Section 31
of the Investment Company Act of 1940 (15 U.S.C. 80a-30) is
amended--
(A) in subsection (a)(1), by adding at the end the
following: ``Each person having custody or use of the
securities, deposits, or credits of a registered investment
company shall maintain and preserve all records that relate
to the custody or use by such person of the securities,
deposits, or credits of the registered investment company for
such period or periods as the Commission, by rule or
regulation, may prescribe, as necessary or appropriate in the
public interest or for the protection of investors.''; and
(B) in subsection (b), by adding at the end the following:
``(4) Records of persons with custody or use.--
``(A) In general.--Records of persons having custody or use
of the securities, deposits, or credits of a registered
investment company that relate to such custody or use, are
subject at any time, or from time to time, to such reasonable
periodic, special, or other examinations and other
information and document requests by representatives of the
Commission, as the Commission deems necessary or appropriate
in the public interest or for the protection of investors.
``(B) Certain persons subject to other regulation.--Any
person that is subject to regulation and examination by a
Federal financial institution regulatory agency (as such term
is defined under section 212(c)(2) of title 18, United States
Code) may satisfy any examination request, information
request, or document request described under subparagraph
(A), by providing to the Commission a detailed listing, in
writing, of the securities, deposits, or credits of the
registered investment company within the custody or use of
such person.''.
(2) Investment advisers act of 1940 amendment.--Section 204
of the Investment Advisers Act of 1940 (15 U.S.C. 80b-4) is
amended by adding at the end the following new subsection:
``(d) Records of Persons With Custody or Use.--
``(1) In general.--Records of persons having custody or use
of the securities, deposits, or credits of a client, that
relate to such custody or use, are subject at any time, or
from time to time, to such reasonable periodic, special, or
other examinations and other information and document
requests by representatives of the Commission, as the
Commission deems necessary or appropriate in the public
interest or for the protection of investors.
``(2) Certain persons subject to other regulation.--Any
person that is subject to regulation and examination by a
Federal financial institution regulatory agency (as such term
is defined under section 212(c)(2) of title 18, United States
Code) may satisfy any examination request, information
request, or document request described under paragraph (1),
by providing the Commission with a detailed listing, in
writing, of the securities, deposits, or credits of the
client within the custody or use of such person.''.
(b) Streamlined Hiring Authority for Market Specialists.--
(1) Appointment authority.--Section 3114 of title 5, United
States Code, is amended by striking the section heading and
all that follows through the end of subsection (a) and
inserting the following:
``Sec. 3114. Appointment of candidates to certain positions
in the competitive service by the Securities and Exchange
Commission
``(a) Applicability.--This section applies with respect to
any position of accountant, economist, and securities
compliance examiner at the Commission that is in the
competitive service, and any position at the Commission in
the competitive service that requires specialized knowledge
of financial and capital market formation or regulation,
financial market structures or surveillance, or information
technology.''.
(2) Clerical amendment.--The table of sections for chapter
31 of title 5, United States Code, is amended by striking the
item relating to section 3114 and inserting the following:
``3114. Appointment of candidates to positions in the competitive
service by the Securities and Exchange Commission.''.
(3) Pay authority.--The Commission may set the rate of pay
for experts and consultants appointed under the authority of
section 3109 of title 5, United States Code, in the same
manner in which it sets the rate of pay for employees of the
Commission.
(c) SIPC Reforms.--
(1) Removing the distinction between claims for cash and
claims for securities.--The Securities Investor Protection
Act of 1970 (15 U.S.C. 78aaa et seq.) is amended--
(A) in section 8(e)(4)(B) (15 U.S.C. 78fff-2(e)(4)(B)), by
striking ``for cash or securities'';
(B) in section 9(a) (15 U.S.C. 78fff-3(a))--
(i) by striking paragraph (1); and
(ii) by redesignating paragraphs (2) through (5) as
paragraphs (1) through (4), respectively; and
(C) in section 16(2)(B) (15 U.S.C. 78lll(2)(B)), by
striking ``for cash or securities''.
(2) Liquidation of a carrying broker-dealer.--Section
5(a)(3) of the Securities Investor Protection Act of 1970 (15
U.S.C. 78eee(a)(3)) is amended--
(A) by striking the undesignated matter immediately
following subparagraph (B);
(B) in subparagraph (A), by striking ``any member of SIPC''
and inserting ``the member'';
(C) in subparagraph (B), by striking the comma at the end
and inserting a period;
(D) by striking ``If SIPC'' and inserting the following:
``(A) In general.--SIPC may, upon notice to a member of
SIPC, file an application for a protective decree with any
court of competent jurisdiction specified in section 21(e) or
27 of the Securities Exchange Act of 1934, except that no
such application shall be filed with respect to a member, the
only customers of which are persons whose claims could not be
satisfied by SIPC advances pursuant to section 9, if SIPC'';
and
(E) by adding at the end the following:
[[Page S2647]]
``(B) Consent required.--No member of SIPC that has a
customer may enter into an insolvency, receivership, or
bankruptcy proceeding, under Federal or State law, without
the specific consent of SIPC.''.
SEC. 4. ENHANCED ABILITY OF COMMISSION TO OBTAIN NEEDED
INFORMATION.
(a) Investment Company Examination.--Section 31(b)(1) of
the Investment Company Act of 1940 (15 U.S.C. 80a-30(b)(1))
is amended to read as follows:
``(1) In general.--The following records shall be subject,
at any time, or from time to time, to such reasonable
periodic, special, or other examinations by representatives
of the Commission as the Commission deems necessary or
appropriate in the public interest or for the protection of
investors:
``(A) All records of a registered investment company.
``(B) All records of a underwriter, broker, dealer, or
investment adviser that is a majority-owned subsidiary of a
registered investment company.
``(C) All records required to be maintained and preserved
by a investment adviser that is not a majority-owned
subsidiary of a registered investment company.
``(D) All records required to be maintained and preserved
by a depositor of a registered investment company.
``(E) All records required to be maintained and preserved
by a principal underwriter for a registered investment
company (other than a closed-end company).''.
(b) Expanded Access to Grand Jury Information.--Chapter 215
of title 18, United States Code, is amended by adding at the
end the following:
``Sec. 3323. Access to grand jury information
``(a) Disclosure.--
``(1) In general.--Upon motion of an attorney for the
government, a court may direct disclosure of matters
occurring before a grand jury during an investigation of
conduct that may constitute a violation of any provision of
the securities laws to the Securities and Exchange Commission
for use in relation to any matter within the jurisdiction of
the Commission.
``(2) Substantial need required.--A court may issue an
order under paragraph (1) only upon a finding of a
substantial need in the public interest.
``(b) Use of Matter.--A person to whom a matter has been
disclosed under this section shall not use such matter, other
than for the purpose for which such disclosure was
authorized.
``(c) Definitions.--As used in this section--
``(1) the terms `attorney for the government' and `grand
jury information' have the meanings given to those terms in
section 3322 of title 18, United States Code; and
``(2) the term `securities laws' has the same meaning as in
section 3(a)(47) of the Securities Exchange Act of 1934.''.
(c) Enhanced Authority of the Securities and Exchange
Commission to Conduct Surveillance and Risk Assessment.--
(1) Securities exchange act of 1934.--Section 17(b) of the
Securities Exchange Act of 1934 (15 U.S.C. 78q(b)) is amended
by adding at the end the following:
``(5) Surveillance and risk assessment.--All persons
described in subsection (a) are subject, at any time, or from
time to time, to such reasonable periodic, special, or other
information and document requests by representatives of the
Commission as the Commission, by rule or order, deems
necessary or appropriate to conduct surveillance or risk
assessments of the securities markets, persons registered
with the Commission under this title, or otherwise in
furtherance of the purposes of this title.''.
(2) Investment company act of 1940.--Section 31(b) of the
Investment Company Act of 1940 (15 U.S.C. 80a-30(b)) is
amended by adding at the end the following:
``(5) Surveillance and risk assessment.--All persons
described in subsection (a) are subject at any time, or from
time to time, to such reasonable periodic, special, or other
information and document requests by representatives of the
Commission as the Commission, by rule or order, deems
necessary or appropriate to conduct surveillance or risk
assessments of the securities markets, persons registered
with the Commission under this title, or otherwise in
furtherance of the purposes of this title.''.
(3) Document requests.--Section 204 of the Investment
Advisers Act of 1940 (15 U.S.C. 80b-4) is amended by adding
at the end the following:
``(e) Surveillance and Risk Assessment.--All persons
described in subsection (a) are subject at any time, or from
time to time, to such reasonable periodic, special, or other
information and document requests by representatives of the
Commission as the Commission, by rule or order, deems
necessary or appropriate to conduct surveillance or risk
assessments of the securities markets, persons registered
with the Commission under this title, or otherwise in
furtherance of the purposes of this title.''.
(d) Protecting Confidentiality of Materials Submitted to
the Commission.--
(1) Securities exchange act of 1934.--Section 24 of the
Securities Exchange Act of 1934 (15 U.S.C. 78x) is amended--
(A) in subsection (d), by striking ``subsection (e)'' and
inserting ``subsection (f)'';
(B) by redesignating subsection (e) as subsection (f); and
(C) by inserting after subsection (d) the following:
``(e) Records Obtained From Registered Persons.--
``(1) In general.--Except as provided in subsection (f),
the Commission shall not be compelled to disclose records or
information obtained pursuant to section 17(b), or records or
information based upon or derived from such records or
information, if such records or information have been
obtained by the Commission for use in furtherance of the
purposes of this title, including surveillance, risk
assessments, or other regulatory and oversight activities.
``(2) Treatment of information.--For purposes of section
552 of title 5, United States Code, this subsection shall be
considered a statute described in subsection (b)(3)(B) of
such section 552. Collection of information pursuant to
section 17 shall be an administrative action involving an
agency against specific individuals or agencies pursuant to
section 3518(c)(1) of title 44, United States Code.''.
(2) Investment company act of 1940.--Section 31 of the
Investment Company Act of 1940 (15 U.S.C. 80a-30) is
amended--
(A) by striking subsection (c) and inserting the following:
``(c) Limitations on Disclosure by Commission.--
Notwithstanding any other provision of law, the Commission
shall not be compelled to disclose any records or information
provided to the Commission under this section, or records or
information based upon or derived from such records or
information, if such records or information have been
obtained by the Commission for use in furtherance of the
purposes of this title, including surveillance, risk
assessments, or other regulatory and oversight activities.
Nothing in this subsection authorizes the Commission to
withhold information from the Congress or prevent the
Commission from complying with a request for information from
any other Federal department or agency requesting the
information for purposes within the scope of jurisdiction of
that department or agency, or complying with an order of a
court of the United States in an action brought by the United
States or the Commission. For purposes of section 552 of
title 5, United States Code, this section shall be considered
a statute described in subsection (b)(3)(B) of such section
552. Collection of information pursuant to section 31 shall
be an administrative action involving an agency against
specific individuals or agencies pursuant to section
3518(c)(1) of title 44, United States Code.'';
(B) by striking subsection (d); and
(C) by redesignating subsections (e) and (f) as subsections
(d) and (e), respectively.
(3) Investment advisers act of 1940.--Section 210 of the
Investment Advisers Act of 1940 (15 U.S.C. 80b-10) is amended
by adding at the end the following:
``(d) Limitations on Disclosure by the Commission.--
Notwithstanding any other provision of law, the Commission
shall not be compelled to disclose any records or information
provided to the Commission under this section, or records or
information based upon or derived from such records or
information, if such records or information have been
obtained by the Commission for use in furtherance of the
purposes of this title, including surveillance, risk
assessments, or other regulatory and oversight activities.
Nothing in this subsection authorizes the Commission to
withhold information from the Congress or prevent the
Commission from complying with a request for information from
any other Federal department or agency requesting the
information for purposes within the scope of jurisdiction of
that department or agency, or complying with an order of a
court of the United States in an action brought by the United
States or the Commission. For purposes of section 552 of
title 5, United States Code, this section shall be considered
a statute described in subsection (b)(3)(B) of such section
552. Collection of information pursuant to section 31 shall
be an administrative action involving an agency against
specific individuals or agencies pursuant to section
3518(c)(1) of title 44, United States Code.''.
(e) Expansion of Audit Information to Be Produced and
Exchanged.--Section 106 of the Sarbanes-Oxley Act of 2002 (15
U.S.C. 7216) is amended--
(1) by striking subsection (b) and inserting the following:
``(b) Production of Documents.--
``(1) Production by foreign firms.--If a foreign public
accounting firm issues an audit report, performs audit work,
conducts interim reviews, or performs material services upon
which a registered public accounting firm relies in the
conduct of an audit or interim review, the foreign public
accounting firm shall--
``(A) produce its audit work papers and all other documents
related to any such audit work or interim review to the
Commission or the Board; and
``(B) be subject to the jurisdiction of the courts of the
United States for purposes of enforcement of any request for
such documents.
``(2) Other production.--Any registered public accounting
firm that relies, in whole or in part, on the work of a
foreign public accounting firm in issuing an audit report,
performing audit work, or conducting an interim review,
shall--
``(A) produce the audit work papers of the foreign public
accounting firm and all other documents related to any such
work in response to a request for production by the
Commission or the Board; and
``(B) secure the agreement of any foreign public accounting
firm to such production, as a condition of the reliance by
the registered public accounting firm on the work of that
foreign public accounting firm.'';
[[Page S2648]]
(2) by redesignating subsection (d) as subsection (g); and
(3) by inserting after subsection (c) the following:
``(d) Service of Requests or Process.--
``(1) In general.--Any foreign public accounting firm that
performs work for a domestic registered public accounting
firm shall furnish to the domestic registered public
accounting firm a written irrevocable consent and power of
attorney that designates the domestic registered public
accounting firm as an agent upon whom may be served any
process, pleadings, or other papers in any action brought to
enforce this section.
``(2) Specific audit work.--Any foreign public accounting
firm that issues an audit report, performs audit work,
performs interim reviews, or performs material services upon
which a registered public accounting firm relies in the
conduct of an audit or interim review, shall designate to the
Commission or the Board an agent in the United States upon
whom may be served any process, pleading, or other papers in
any action brought to enforce this section or any request by
the Commission or the Board under this section.
``(e) Sanctions.--A willful refusal to comply, in whole in
or in part, with any request by the Commission or the Board
under this section, shall be deemed a violation of this Act.
``(f) Other Means of Satisfying Production Obligations.--
Notwithstanding any other provisions of this section, the
staff of the Commission or the Board may allow a foreign
public accounting firm that is subject to this section to
meet production obligations under this section through
alternate means, such as through foreign counterparts of the
Commission or the Board.''.
(f) Sharing Privileged Information With Other
Authorities.--Section 24 of the Securities Exchange Act of
1934 (15 U.S.C. 78x) is amended--
(1) in subsection (d), as amended by subsection (d)(1)(A),
by striking ``subsection (f)'' and inserting ``subsection
(g)'';
(2) in subsection (e), as added by subsection (d)(1)(C), by
striking ``subsection (f)'' and inserting ``subsection (g)'';
(3) by redesignating subsection (f) as subsection (g); and
(4) by inserting after subsection (e) the following:
``(f) Sharing Privileged Information With Other
Authorities.--
``(1) Privileged information provided by the commission.--
The Commission shall not be deemed to have waived any
privilege applicable to any information by transferring that
information to or permitting that information to be used by--
``(A) any agency (as defined in section 6 of title 18,
United States Code);
``(B) the Public Company Accounting Oversight Board;
``(C) any self-regulatory organization;
``(D) any foreign securities authority;
``(E) any foreign law enforcement authority; or
``(F) any State securities or law enforcement authority.
``(2) Nondisclosure of privileged information provided to
the commission.--The Commission shall not be compelled to
disclose privileged information obtained from any foreign
securities authority, or foreign law enforcement authority,
if the authority has in good faith determined and represented
to the Commission that the information is privileged.
``(3) Nonwaiver of privileged information provided to the
commission.--
``(A) In general.--Federal agencies, State securities and
law enforcement authorities, self-regulatory organizations,
and the Public Company Accounting Oversight Board shall not
be deemed to have waived any privilege applicable to any
information by transferring that information to or permitting
that information to be used by the Commission.
``(B) Exception.--The provisions of subparagraph (A) shall
not apply to a self-regulatory organization or the Public
Company Accounting Oversight Board with respect to
information used by the Commission in an action against such
organization.
``(4) Definitions.--For purposes of this subsection--
``(A) the term `privilege' includes any work-product
privilege, attorney-client privilege, governmental privilege,
or other privilege recognized under Federal, State, or
foreign law;
``(B) the term `foreign law enforcement authority' means
any foreign authority that is empowered under foreign law to
detect, investigate or prosecute potential violations of law;
and
``(C) the term `State securities or law enforcement
authority' means the authority of any State or territory that
is empowered under State or territory law to detect,
investigate, or prosecute potential violations of law.''.
SEC. 5. MODERNIZATION OF INVESTOR PROTECTIONS.
(a) Municipal Securities.--Section 15B of the Securities
Exchange Act of 1934 (15 U.S.C. 78o-4) is amended--
(1) by striking ``(b)(1) Not later'' and all that follows
through ``succeed such initial members.'' and inserting the
following:
``(b) Municipal Securities Rulemaking Board.--
``(1) Composition of the municipal securities rulemaking
board.--Not later than October 1, 2010, the Municipal
Securities Rulemaking Board (hereinafter in this section
referred to as the `Board'), shall--
``(A) be composed of members who shall perform the duties
set forth in this section; and
``(B) shall consist of--
``(i) a majority of independent public representatives, at
least 1 of whom shall be representative of investors in
municipal securities and at least 1 of whom shall be
representative of issuers of municipal securities (which
members are hereinafter referred to as `public
representatives');
``(ii) at least 1 individual who is representative of
municipal securities brokers and municipal securities dealers
that are not banks or subsidiaries, departments or divisions
of banks (which members are hereinafter referred to as
`broker-dealer representatives'); and
``(iii) at least 1 individual who is representative of
municipal securities dealers that are banks or subsidiaries,
departments or divisions of banks (which members are
hereinafter referred to as `bank representatives').''; and
(2) in paragraph (2), by amending subparagraph (B) to read
as follows:
``(B) establish fair procedures for the nomination and
election of members of the Board and assure fair
representation in such nominations and elections of municipal
securities brokers and municipal securities dealers. Such
rules--
``(i) shall establish requirements regarding the
independence of public representatives;
``(ii) shall provide that the number of public
representatives of the Board shall at all times exceed the
total number of broker-dealer representatives and bank
representatives;
``(iii) shall establish minimum knowledge, experience, and
other appropriate qualifications for individuals to serve as
public representatives, which may include prior work
experience in the securities, municipal finance, or municipal
securities industries;
``(iv) shall specify the term members shall serve; and
``(v) may increase or decrease the number of members which
shall constitute the whole Board, except that in no case may
the number of members of the whole Board be an even
number.''.
(b) Beneficial Ownership and Short-Swing Profit
Reporting.--
(1) Beneficial ownership reporting.--Section 13 of the
Securities Exchange Act of 1934 (15 U.S.C. 78m) is amended--
(A) in subsection (d)--
(i) in paragraph (1)--
(I) by inserting after ``within ten days after such
acquisition,'' the following: ``or within such shorter period
as the Commission may establish, by rule,''; and
(II) by striking ``send to the issuer of the security at
its principal executive office, by registered or certified
mail, send to each exchange on which the security is traded,
and''; and
(ii) in paragraph (2)--
(I) by striking ``in the statements to the issuer and the
exchange, and''; and
(II) by striking ``shall be transmitted to the issuer and
the exchange and''; and
(B) in subsection (g)--
(i) in paragraph (1), by striking ``shall send to the
issuer of the security and''; and
(ii) in paragraph (2)--
(I) by striking ``sent to the issuer and''; and
(II) by striking ``shall be transmitted to the issuer
and''.
(2) Short-swing profit reporting.--Section 16(a) of the
Securities Exchange Act of 1934 (15 U.S.C. 78p(a)) is
amended--
(A) in paragraph (1), by striking ``(and, if such security
is registered on a national securities exchange, also with
the exchange)''; and
(B) in paragraph (2)(B), by inserting after ``officer'' the
following: ``, or within such shorter period as the
Commission may establish, by rule''.
(c) Enhanced Application of Antifraud Provisions.--The
Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is
amended--
(1) in section 9--
(A) by striking ``registered on a national securities
exchange'' each place that term appears and inserting ``other
than a government security'';
(B) in subsection (b), by striking ``by use of any facility
of a national securities exchange,''; and
(C) in subsection (c), by inserting after ``unlawful for
any'' the following: ``broker, dealer, or'';
(2) in section 10(a)(1), by striking ``registered on a
national securities exchange'' and inserting ``other than a
government security''; and
(3) in section 15(c)(1)(A), by striking ``otherwise than on
a national securities exchange of which it is a member''.
(d) Definition of ``Interested Person''.--Section
2(a)(19)(A) of the Investment Company Act of 1940 (15 U.S.C.
80a-2(a)(19)(A)) is amended--
(1) by striking clause (v) and inserting the following:
``(v) any natural person who is a member of a class of
persons who the Commission, by rule or regulation, determines
are unlikely to exercise an appropriate degree of
independence as a result of--
``(I) a material business or professional relationship with
such company or any affiliated person of such company; or
``(II) a close familial relationship with any natural
person who is an affiliated person of such company,'';
(2) by striking clause (vi);
[[Page S2649]]
(3) by redesignating clause (vii) as clause (vi); and
(4) in clause (vi), as so redesignated, by striking ``two''
and inserting ``5''.
(e) Lost and Stolen Securities.--Section 17(f)(1) of the
Securities Exchange Act of 1934 (15 U.S.C. 78q(f)(1)) is
amended--
(1) in subparagraph (A), by striking ``missing, lost,
counterfeit, or stolen securities'' and inserting
``securities that are missing, lost, counterfeit, stolen,
cancelled, or any other category of securities as the
Commission, by rule, may prescribe''; and
(2) in subparagraph (B), by striking ``or stolen'' and
inserting ``stolen, cancelled, or reported in such other
manner as the Commission, by rule, may prescribe''.
(f) Fingerprinting.--Section 17(f)(2) of the Securities
Exchange Act of 1934 (15 U.S.C. 78q(f)(2)) is amended--
(1) in the first sentence, by striking ``and registered
clearing agency,'' and inserting ``registered clearing
agency, registered securities information processor, national
securities exchange, and national securities association'';
and
(2) in the second sentence, by striking ``or clearing
agency,'' and inserting ``clearing agency, securities
information processor, national securities exchange, or
national securities association,''.
SEC. 6. COMMISSION ORGANIZATIONAL STUDY AND REFORM.
(a) Study Required.--
(1) In general.--Not later than 90 days after the date of
the enactment of this Act, the Securities and Exchange
Commission (in this section referred to as the
``Commission'') shall hire an independent consultant of high
caliber who has expertise in organizational restructuring and
the operations of capital markets to examine the internal
operations, structure, funding, and the need for
comprehensive reform of the Commission, as well as the
relationship of the Commission with and the reliance by the
Commission on self-regulatory organizations and other
entities relevant to the regulation of securities and the
protection of securities investors that are under the
oversight of the Commission.
(2) Specific areas for study.--The study required under
paragraph (1) shall, at a minimum, include the study of--
(A) the possible elimination of unnecessary or redundant
units at the Commission;
(B) improving communications between offices and divisions
of the Commission;
(C) the need to put in place a clear chain-of-command
structure, particularly for enforcement examinations and
compliance inspections;
(D) the effect of high-frequency trading and other
technological advances on the market and what the Commission
requires to monitor the effect of such trading and advances
on the market;
(E) the hiring authorities, workplace policies, and
personal practices of the Commission, including--
(i) whether there is a need to further streamline hiring
authorities for those who are not lawyers, accountants,
compliance examiners, or economists;
(ii) whether there is a need for further pay reforms;
(iii) the diversity of skill sets of Commission employees
and whether the present skill set diversity efficiently and
effectively fosters the mission of the Commission of investor
protection; and
(iv) the application of civil service laws by the
Commission;
(F) whether the oversight by the Commission of, and
reliance by the Commission on, self-regulatory organizations
promotes efficient and effective governance for the
securities markets; and
(G) whether adjusting the reliance by the Commission on
self-regulatory organizations is necessary to promote more
efficient and effective governance for the securities
markets.
(b) Consultant Report.--Not later than 150 days after the
independent consultant is retained under subsection (a), the
independent consultant shall submit a report to the
Commission and to Congress containing--
(1) a detailed description of any findings and conclusions
made while carrying out the study required under subsection
(a)(1); and
(2) recommendations for legislative, regulatory, or
administrative action that the independent consultant
determines appropriate to enable the Commission and other
entities on which the independent consultant reports to
perform the missions of the Commission, whether mandated by
statute or otherwise.
(c) Commission Report.--Not later than 6 months after the
date on which the consultant submits the report under
subsection (b), and every 6 months thereafter during the 2-
year period following the date on which the consultant
submits the report under subsection (b), the Commission shall
submit a report to the Committee on Banking, Housing, and
Urban Affairs of the Senate and the Committee on Financial
Services of the House of Representatives describing the
implementation by the Commission of the regulatory and
administrative recommendations contained in the report of the
independent consultant under subsection (b).
______
By Mr. KOHL (for himself, Mr. Leahy, and Mr. Hatch):
S. 3259. A bill to amend subtitle A of the Antitrust Criminal Penalty
Enhancement and Reform Act of 2004 to make the operation of such
subtitle permanent law; to the Committee on the Judiciary.
Mr. KOHL. Mr. President, I rise today to introduce the Antitrust
Criminal Penalties Enforcement and Reform Act of 2004 Extension Act.
This legislation makes permanent a critical component of the Antitrust
Criminal Penalty Enforcement and Reform Act of 2004, set to expire on
June 22, which encourages participation in the Antitrust Division's
leniency program. As a result, the Justice Department will be able to
continue to detect, investigate and aggressively prosecute price-fixing
cartels which harm consumers.
The Antitrust Division of the Department of Justice has long
considered criminal cartel enforcement a top priority, and its
Corporate Leniency Policy is an important tool in that enforcement.
Criminal antitrust offenses are generally conspiracies among
competitors to fix prices, rig bids, or allocate markets of customers.
The Leniency Policy creates incentives for corporations to report their
unlawful cartel conduct to the Division, by offering the possibility of
immunity from criminal charges to the first-reporting corporation, as
long as there is full cooperation. For more than 15 years, this policy
has allowed the Division to uncover cartels affecting billions of
dollars worth of commerce here in the United States, which has led to
prosecutions resulting in record fines and jail sentences.
An important part of the Division's Leniency Policy, added by the
Antitrust Criminal Penalties Enforcement and Reform Act of 2004, limits
the civil liability of leniency participants to the actual damages
caused by that company--rather than triple the damages caused by the
entire conspiracy, which is typical in civil antitrust lawsuits. This
removed a significant disincentive to participation in the leniency
program--the concern that, despite immunity from criminal charges, a
participating corporation might still be on the hook for treble damages
in any future antitrust lawsuits.
Maintaining strong incentives to make use of the Leniency Policy
provides important benefits to the victims of antitrust offenses, often
consumers who paid artificially high prices. It makes it more likely
that criminal antitrust violations will be reported and, as a result,
consumers will be able to identify and recover their losses from paying
illegally inflated prices. The policy also requires participants to
cooperate with plaintiffs in any follow-on civil lawsuits, which makes
it more likely that the plaintiff consumers will be able to build
strong cases against all members of the conspiracy.
Since the passage of ACPERA, the Antitrust Division has uncovered a
number of significant cartel cases through its leniency program,
including the air cargo investigation, which so far has yielded over a
billion dollars in criminal fines. In that investigation, several
airlines pled guilty to conspiring to fix international air cargo rates
and international passenger fuel surcharges. Not only were criminal
fines levied but one high-ranking executive pled guilty and agreed to
serve 8 months in prison. In fiscal year 2004, before the passage of
ACPERA, criminal antitrust fines totaled $350 million. Criminal
antitrust fines in fiscal year 2009 surpassed $1 billion. Scott
Hammond, the Deputy Assistant Attorney General for Criminal Enforcement
in the Antitrust Division, has stated that the damages limitation has
made its Corporate Leniency Program ``even more effective'' at
detecting and prosecuting cartels. In fact, in the first 5 years after
passage, leniency applications increased by 25 percent, and the
Antitrust Division experienced ``unprecedented'' success in criminal
enforcement.
ACPERA's damages limitation is set to expire in June, so we must act
quickly to extend it. Otherwise, the Justice Department will lose an
important tool that it uses to investigate and prosecute criminal
cartel activity. The strong evidence that this program works means it
is time to make it permanent. Permanence will give all parties--the
government, potential amnesty applicants, and potential private
litigants--a clear sign that criminal cartel enforcement continues to
be a top priority, and that the amnesty program is a key and continuing
component of that enforcement program.
[[Page S2650]]
This certainty is likely to lead to increased participation in the
amnesty program, the discovery of more cases, the receipt of more
criminal fines, and a higher likelihood of consumers being able to
recover their losses in civil litigation.
Some have raised questions about whether the leniency program could
be made more effective by changing the requirements for leniency
applicants to cooperate in private litigation, or by increasing the
incentive for whistleblowing. Currently, there is insufficient evidence
to show that changes are needed and the Department of Justice is
concerned that any changes could have the unintended consequence of
reducing the incentives to use the Leniency Program. Therefore, at this
time we are hesitant to tinker with success. However, in response to
the concerns, the Antitrust Criminal Penalties Enforcement and Reform
Act of 2004 Extension Act of 2010 requires a GAO study to consider the
effectiveness of the incentives for leniency applicants to cooperate in
private litigation, and specifically whether such cooperation is made
in a timely fashion. The Antitrust Criminal Penalties Enforcement and
Reform Act of 2004 is meant to facilitate both government and private
enforcement of the antitrust laws, and the GAO study will shed some
light on whether it strikes the correct balance. When we receive the
study, we will review it and act accordingly, changing the law if
necessary.
I urge my colleagues to support this important legislation.
Mr. President, I ask unanimous consent that the text of the bill be
printed in the Record.
There being no objection, the text of the bill was ordered to be
printed in the Record, as follows:
S. 3259
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Antitrust Criminal Penalties
Enforcement and Reform Act of 2004 Extension Act of 2010''.
SEC. 2. ELIMINATION OF SUNSET.
The Antitrust Criminal Penalty Enhancement and Reform Act
of 2004 (15 U.S.C. 1 note) is amended by striking section
211.
SEC. 3. EFFECTIVE DATE OF AMENDMENT.
The amendment made by section 2 shall take effect
immediately before June 22, 2010.
SEC. 4. GAO REPORT.
Not later than 1 year after the date of enactment of this
Act, the Comptroller General shall submit a report to the
Committees on the Judiciary of the House of Representatives
and the Senate on the effectiveness of the Antitrust Criminal
Penalties Enforcement and Reform Act of 2004, both in
criminal investigation and enforcement by the Department of
Justice and in private civil actions. Such report shall
consider, inter alia, the effectiveness of incentives for
cooperation, and the timeliness of that cooperation, in
private civil actions.
______
By Mr. HARKIN (for himself, Ms. Klobuchar, and Mr. Franken):
S. 3260. A bill to enhance and further research into the prevention
and treatment of eating disorders, to improve access to treatment of
eating disorders, and for other purposes; to the Committee on Health,
Education, Labor, and Pensions.
Mr. HARKIN. Mr. President, today I am joining with Senator Klobuchar
and Senator Franken to introduce the Federal Response to Eliminate
Eating Disorders, FREED, Act. This important bill is the first
comprehensive legislative effort to confront eating disorders in the
U.S.
Eating disorders such as anorexia nervosa and bulimia nervosa are
widespread, insidious, and too often fatal diseases. Today, at least 5
million Americans suffer from eating disorders. Because these diseases
often go undiagnosed and uncounted, the actual number is closer to 11
million Americans. Adolescent women are by no means the only people
suffering from eating disorders; these diseases don't discriminate by
gender, race, income, or age.
Eating disorders are dangerous conditions, but their consequences are
often underestimated. These diseases can lead to serious heart
conditions, kidney failure, osteoporosis, infertility, gastrointestinal
disorders, and even death. The National Institute of Mental Health
estimates that one in 10 people with anorexia nervosa will die of
starvation, cardiac arrest, or some other medical complication. One in
10! That is deeply disturbing, and cries out for a much more aggressive
Federal response. Moreover, fatalities resulting from eating disorders
are grossly underreported, because deaths are typically recorded by
listing the immediate cause of death, such as cardiac arrest, rather
than the underlying cause, which is the eating disorder.
But, despite their prevalence and very serious impacts on health,
research funding for eating disorders has lagged behind funding for
research into similar diseases. We simply don't know enough about the
causes and consequences of eating disorders, or how to stop them from
developing in the first place. We have research suggesting that there's
a genetic component to eating disorders, but we have got to learn more
so we can effectively prevent these diseases before they start.
The good news is that eating disorders are treatable. With
appropriate nutritional, medical, and psychotherapeutic interventions,
they can be successfully and fully cured. But right now, only one in 10
people receive treatment.
The FREED Act takes a major step forward in promoting research,
screening, treatment, and the prevention of eating disorders.
First, the FREED Act expands research efforts at the National
Institutes of Health to examine the causes and consequences of eating
disorders. We need to understand these diseases to more effectively
prevent and treat them. The FREED Act also improves surveillance and
data collection systems at the Centers for Disease Control and
Prevention so we'll have accurate information and epidemiological data
on eating disorders.
Second, the FREED Act expands access to treatment services and
screening for eating disorders for Medicaid beneficiaries, and creates
a patient advocacy network that will help individuals with eating
disorders find treatment. Furthermore, the FREED Act improves the
training and education of health care providers and educators so they
know how to identify and treat individuals suffering from eating
disorders.
Finally, we need to step up efforts to prevent these diseases in the
first place. As I have said so many times, we don't have a genuine
health care system in America, we have a sick care system. In other
words, if you get sick, you get treatment. But we can spend just
pennies on the dollar to prevent disease and illness in the first place
by placing a much more robust emphasis on wellness, nutrition, physical
activity, and public health. With this in mind, the FREED Act
authorizes grants to develop and implement evidence-based prevention
programs and promote healthy eating behaviors in schools, athletic
programs, and other community-based programs.
Sadly, eating disorders are not rare. These diseases touch the lives
of so many of our families and friends. Nearly half of all Americans
personally know someone with an eating disorder. We have got to do a
better job at the Federal level of investing in research, treatment,
and prevention. The FREED Act builds on the investments we made in
prevention, wellness, and mental health in health reform and mental
health parity.
I thank Senator Klobuchar and Senator Franken for partnering with me
on this bill, and urge our colleagues to join us in dramatically
stepping up the federal response to eating disorders.
Mr. President, I ask unanimous consent that the text of the bill be
printed in the Record.
There being no objection, the text of the bill was ordered to be
printed in the Record, as follows:
S. 3260
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Federal Response to
Eliminate Eating Disorders Act''.
SEC. 2. FINDINGS.
Congress finds as follows:
(1) Estimates, based on current research, indicate that at
least 5,000,000 people in the United States suffer from
eating disorders including anorexia nervosa, bulimia nervosa,
binge eating disorder, and eating disorders not otherwise
specified (referred to in this Act as ``EDNOS'').
(2) Anecdotal evidence suggests that as many as 11,000,000
people in the United States, including 1,000,000 males, may
suffer from eating disorders.
[[Page S2651]]
(3) Eating disorders occur in all nations and in all
populations, and among people of all ages and races and of
both genders.
(4) Eating disorders are diseases with grave health
consequences and high rates of mortality.
(5) Health consequences associated with eating disorders
include heart failure and other serious cardiac conditions,
electrolyte imbalance, kidney failure, osteoporosis,
debilitating tooth decay, and gastrointestinal disorders,
including esophageal inflammation and rupture, gastric
rupture, peptic ulcers, and pancreatitis.
(6) Anorexia nervosa has one of the highest overall
mortality rates of any mental illness. According to the
National Institute of Mental Health, 1 in 10 people with
anorexia nervosa will die of starvation, cardiac arrest, or
another medical complication.
(7) The risk of death among adolescents with anorexia
nervosa is 11 times greater than in disease-free adolescents.
(8) Anorexia nervosa has the highest suicide rate of all
mental illnesses.
(9) New research suggests that bulimia nervosa has a much
higher rate of mortality than is reflected in current
statistics, because of the failure to identify the underlying
eating disorder.
(10) Binge eating disorder is the most common eating
disorder, with an estimated 3.5 percent of American women and
2 percent of American men expected to suffer from this
disorder in their lifetime. Binge eating disorder is
characterized by frequent episodes of uncontrolled overeating
and is associated with obesity, heart disease, gall bladder
disease, and diabetes.
(11) Research demonstrates that there is a significant
genetic component to the development of eating disorders.
(12) Certain populations, including adolescent females and
athletes of both genders, are at higher risk of developing an
eating disorder.
(13) Different types of eating disorders may affect certain
races and genders disproportionately.
(14) Despite the serious health consequences and the high
risk of death, Federal research funding for eating disorders
has lagged behind research concerning other diseases, when
compared by the number of individuals affected by, and the
relative health consequences of, the diseases.
(15) The ability of individuals suffering from eating
disorders, particularly bulimia nervosa, binge eating
disorder, and EDNOS to access appropriate treatment is
unacceptably low.
(16) The development of an eating disorder is frequently
preceded by unhealthy weight control behaviors commonly
identified as disordered eating, including skipping meals,
using diet pills, taking laxatives, self-induced vomiting,
and fasting. Such disordered eating behaviors should be
included in enhanced research prevention and training
efforts.
SEC. 3. PURPOSES.
The purposes of this Act are--
(1) to expand research into the prevention of eating
disorders;
(2) to expand research on effective treatment and
intervention of eating disorders and to support evidence-
based programs designed to prevent eating disorders;
(3) to expand research on the causes, courses, and outcomes
of eating disorders;
(4) to increase the number of people properly screened and
diagnosed with an eating disorder;
(5) to improve training and education of health care and
behavioral care providers and of school personnel at all
levels of elementary and secondary education;
(6) to improve surveillance and data systems for tracking
the prevalence, severity, and economic costs of eating
disorders; and
(7) to enhance access to comprehensive treatment for eating
disorders.
TITLE I--EATING DISORDER DETECTION AND RESEARCH
SEC. 101. EXPANSION AND COORDINATION OF THE ACTIVITIES OF THE
NATIONAL INSTITUTE OF HEALTH AND THE NATIONAL
INSTITUTE OF MENTAL HEALTH WITH RESPECT TO
RESEARCH ON EATING DISORDERS.
Part B of title IV of the Public Health Service Act (42
U.S.C. 284 et seq.), as amended by section 4305(b) of the
Patient Protection and Affordable Care Act (Public Law 111-
148), is further amended by adding at the end the following:
``SEC. 409K. EXPANSION AND COORDINATION OF ACTIVITIES WITH
RESPECT TO RESEARCH ON EATING DISORDERS.
``(a) In General.--The Director of NIH, pursuant to the
general authority of such director, shall expand, intensify,
and coordinate the activities of the National Institutes of
Health with respect to research on eating disorders.
``(b) Grants.--The Director of NIH may award grants to
public or private entities to pay all or part of the cost of
planning, establishing, improving, and providing basic
operating support for such entities to establish consortia in
eating disorder research and to carry out the activities
described in subsection (e).
``(c) Eligible Entities.--To be eligible to receive a grant
under this section, an entity shall--
``(1) be public or nonprofit private entity (including a
health department of a State, a political subdivision of a
State, or an institution of higher education); and
``(2) submit to the Secretary an application at such time,
in such manner, and containing such information as the
Secretary may require.
``(d) Requirements of Consortia.--
``(1) In general.--Each consortium established as described
in subsection (b) may use the facilities of a single lead
institution, or may be formed from several cooperating
institutions, meeting such requirements as may be prescribed
by the Director of NIH.
``(2) Coordination of consortia.--The Director of NIH--
``(A) may, as appropriate, provide for the coordination of
information among consortia established under subsection (b);
and
``(B) shall ensure regular communication between members of
the various consortia established using grants awarded under
this section.
``(3) Reports.--The Director of NIH shall require each
consortium to periodically prepare and submit to such
director reports on the activities of such consortium.
``(e) Activities.--Each consortium receiving a grant under
subsection (b) shall conduct basic, clinical,
epidemiological, population-based, or translational research
regarding eating disorders, which may include research
related to--
``(1) the identification and classification of eating
disorders and disordered eating;
``(2) the causes, diagnosis, and early detection of eating
disorders;
``(3) the treatment of eating disorders, including the
development and evaluation of new treatments and best
practices;
``(4) the conditions or diseases related to, or arising
from, an eating disorder; and
``(5) the evaluation of existing prevention programs and
the development of reliable prevention and screening
programs.
``(f) Collaboration.--The Secretary, acting through the
Director of NIH and the Director of the National Institute of
Mental Health, shall identify relevant Federal agencies
(including the other institutes and centers of the National
Institutes of Health, the Centers for Medicare & Medicaid
Services, the Centers for Disease Control and Prevention, the
Agency for Healthcare Research and Quality, the Substance
Abuse and Mental Health Services Administration, the Health
Resources and Services Administration, and the Office on
Women's Health) that shall collaborate with respect to
activities conducted under subsection (d).
``(g) Public Input.--The Director of NIH shall provide for
a mechanism--
``(1) to educate and disseminate information on the
existing and planned programs and research activities of the
National Institutes of Health with respect to eating
disorders; and
``(2) through which the Director of NIH may receive
comments from the public regarding such programs and
activities.
``(h) Dissemination of Information.--The Director of NIH
shall provide for a mechanism for making the results and
information generated by the consortia publicly available,
such as through the Internet.
``(i) Definition.--For purposes of this section, the term
`eating disorder' has the meaning given such term in section
399OO(e).
``(j) Authorization of Appropriations.--To carry out this
section, there are authorized to be appropriated such sums as
may be necessary for each of fiscal years 2011 through
2015.''.
SEC. 102. INTERAGENCY COORDINATING COUNCIL; SURVEILLANCE AND
RESEARCH PROGRAM; STUDY ON ECONOMIC COST.
Title III of the Public Health Service Act (42 U.S.C. 241
et seq.), as amended by section 4303 of the Patient
Protection and Affordable Care Act (Public Law 111-148), is
further amended by adding at the end the following:
``PART W--PROGRAMS RELATING TO EATING DISORDERS
``SEC. 399OO. INTERAGENCY EATING DISORDERS COORDINATING
COUNCIL.
``(a) Establishment.--There is established within the
Department of Health and Human Services the Interagency
Eating Disorders Coordinating Council (referred to in this
section as the `Coordinating Council').
``(b) Responsibilities.--The Coordinating Council shall--
``(1) develop and annually update a summary of advances in
eating disorder research concerning causes of, prevention of,
early screening for, treatment and access to services related
to, and supports for individuals affected by, eating
disorders;
``(2) monitor Federal activities with respect to eating
disorders;
``(3) make recommendations to the Secretary regarding any
appropriate changes to such activities, and to the Director
of NIH, with respect to the strategic plan developed under
paragraph (4);
``(4) develop and annually update a strategic plan for the
conduct of, and support for, eating disorder research,
including proposed budgetary recommendations; and
``(5) submit to Congress the strategic plan developed under
paragraph (4) and all updates to such plan.
``(c) Membership.--
``(1) Chairperson.--The Director of NIH shall serve as the
chairperson of the Coordinating Council and shall be
responsible for the leadership and oversight of the
activities of the Coordinating Council.
``(2) Members in general.--The Coordinating Council shall
be composed of--
``(A) representatives of--
``(i) the Agency for Healthcare Research and Quality;
``(ii) the Substance Abuse and Mental Health
Administration;
[[Page S2652]]
``(iii) the research institutes at the National Institutes
of Health, as the Director of NIH determines appropriate;
``(iv) the Health Resources and Services Administration;
``(v) the Centers for Medicare & Medicaid Services;
``(vi) the Office of Women's Health;
``(vii) the Centers for Disease Control and Prevention; and
``(viii) the Department of Education; and
``(B) the additional members appointed under paragraph (3).
``(3) Additional members.--Not fewer than \1/3\ of the
total membership of the Coordinating Council shall be
composed of non-Federal public members to be appointed by the
Secretary, including representatives of--
``(A) academic medical centers or schools of medicine,
nursing, or other health professions;
``(B) health care professionals who are actively involved
in the treatment of eating disorders;
``(C) researchers with expertise in eating disorders; and
``(D) at least 2 individuals with a past or present
diagnosis of an eating disorder or parents of individuals
with a past or present diagnosis of an eating disorder.
``(d) Administrative Support; Terms of Service; Other
Provisions.--
``(1) Administrative support.--The Coordinating Council
shall receive necessary and appropriate administrative
support from the Secretary.
``(2) Terms of service.--Members of the Coordinating
Council appointed under subsection (c)(2) shall serve for a
term of 4 years, and may be reappointed for one or more
additional 4 year-terms. Any member appointed to fill a
vacancy for an unexpired term shall be appointed for the
remainder of such term. A member may serve after the
expiration of the member's term until a successor has taken
office.
``(3) Meetings.--
``(A) In general.--The Coordinating Council shall meet at
the call of the chairperson or upon the request of the
Secretary. The Coordinating Council shall meet not fewer than
2 times each year.
``(B) Notice.--Notice of any upcoming meeting of the
Coordinating Council shall be published in the Federal
Register.
``(C) Public access.--Each meeting of the Coordinating
Council shall be open to the public and shall include
appropriate periods of time for questions by the public.
``(4) Subcommittees.--In carrying out its functions the
Coordinating Council may establish subcommittees and convene
workshops and conferences.
``(e) Eating Disorder.--In this part, the term `eating
disorder' includes anorexia nervosa, bulimia nervosa, binge
eating disorder, and eating disorders not otherwise
specified, as defined in the fourth edition of the Diagnostic
and Statistical Manual of Mental Disorders or any subsequent
edition.
``(f) Authorization of Appropriations.--To carry out this
section, there are authorized to be appropriated such sums as
may be necessary for each of fiscal years 2011 through 2015.
``SEC. 399OO-1. EATING DISORDER SURVEILLANCE AND RESEARCH
PROGRAM.
``(a) In General.--The Secretary, acting through the
Director of the Centers for Disease Control and Prevention,
shall award grants or cooperative agreements to eligible
entities for the purpose of improving the collection,
analysis and reporting of State epidemiological data on
eating disorders.
``(b) Activities.--An eligible entity shall assist with the
development and coordination of eating disorder surveillance
efforts within a region and may--
``(1) provide for the collection, analysis, and reporting
of epidemiological data on eating disorders through the
existing surveillance programs;
``(2) develop recommendations to enhance existing
surveillance programs to more accurately collect
epidemiological data on disordered eating and eating
disorders, including the number, incidence, trends,
correlates, mortality, and causes of eating disorders and the
effects of eating disorders on quality of life;
``(3) develop recommendations to improve requirements for
ensuring that eating disorders are accurately recorded as
underlying and contributing causes of death; and
``(4) assist with the development and coordination of
surveillance efforts within a region.
``(c) Eligible Entities.--To be eligible to receive an
award under this section, an entity shall--
``(1) be a public or nonprofit private entity (including a
health department of a State, a political subdivision of a
State, or an institution of higher education); and
``(2) submit to the Secretary an application at such time,
in such manner, and containing such information as the
Secretary may require.
``(d) Technical Assistance.--In making awards under this
section, the Secretary may provide direct technical
assistance in lieu of cash.
``(e) Reports.--Each entity awarded a grant or cooperative
agreement under this section shall submit to the Secretary a
report describing the activities conducted using grant funds
and providing recommendations for improving the collection,
analysis, and reporting of epidemiological data on eating
disorders.
``(f) Authorization of Appropriations.--To carry out this
section, there are authorized to be appropriated such sums as
may be necessary for each of fiscal years 2011 through 2015.
``SEC. 399OO-2. STUDY REGARDING ECONOMIC COSTS OF EATING
DISORDERS.
``The Secretary, acting through the Director of the Centers
for Disease Control and Prevention, shall conduct a study
evaluating the economic costs of eating disorders. Such study
may examine years of productive life lost, missed days of
work, reduced work productivity, costs of medical and mental
health treatment, costs to family, and costs to society as a
result of eating disorders.''.
TITLE II--EATING DISORDER EDUCATION AND PREVENTION; STUDIES ON EATING
DISORDERS AND BODY MASS INDEX; PUBLIC SERVICE ANNOUNCEMENTS
SEC. 201. GRANTS TO PREVENT EATING DISORDERS.
Title III of the Public Health Service Act (42 U.S.C. 241
et seq.), as amended by section 102, is further amended by
adding at the end the following:
``SEC. 399OO-3. GRANTS TO PREVENT EATING DISORDERS.
``(a) In General.--The Secretary, acting through the
Director of the Centers for Disease Control and Prevention
and in coordination with the Administrator of the Health
Resources and Services Administration, shall award grants to
eligible entities to plan, implement, and evaluate programs
to prevent eating disorders and obesity and the acute and
chronic medical conditions that accompany such conditions,
and to promote healthy body image and appropriate nutrition-
based eating behaviors.
``(b) Eligibility.--To be eligible to receive a grant under
this section, an entity shall--
``(1) be a State, local or tribal educational agency, an
accredited institution of higher education, a State or local
health department, or a community based organization; and
``(2) submit an application to the Secretary at such time,
in such manner, and containing such information as the
Secretary may require.
``(c) Use of Funds.--An entity receiving a grant under this
section shall fund development and testing of school-,
clinic-, community-, or health department-based programs
designed to promote healthy eating behaviors and to prevent
eating disorders including--
``(1) developing evidence-based interventions to prevent
eating disorders, including educational or intervention
programs regarding nutritional content, understanding and
responding to hunger and satiety, positive body image
development, positive self-esteem development, and life
skills, that take into account cultural and developmental
issues and the role of family, school, and community;
``(2) planning and implementing a healthy lifestyle
curriculum or program with an emphasis on healthy eating
behaviors, physical activity, and emotional wellness, the
connection between emotional and physical health, and the
prevention of bullying based on body size, shape, and weight;
``(3) forming partnerships with parents and caregivers to
educate adults about identifying unhealthy eating behaviors
and promoting healthy eating behaviors, physical activity,
and emotional wellness; and
``(4) integrating eating disorder prevention and awareness
in physical education, health, education, athletic training
programs, and after-school recreational sports programs, to
the extent possible.
``(d) Requirements of Grant Recipients.--
``(1) Limitation on administrative expenses.--A recipient
of a grant under this section shall not use more than 10
percent of the amounts received under a grant under this
section for administrative expenses.
``(2) Contribution of funds.--A recipient of a grant under
this section, and any entity receiving assistance under the
grant for training and education, shall contribute non-
Federal funds, either directly or through in-kind
contributions, to the costs of the activities to be funded
under the grant in an amount that is not less than 10 percent
of the total cost of such activities.
``(3) Evaluation.--Each recipient of a grant under this
section shall provide to the Secretary, in such form and
manner as the Secretary shall specify, relevant data and an
evaluation of the activities of the grant recipient in
promoting healthy eating behaviors and preventing eating
disorders. Evaluation reports shall be made publicly
available, such as through the Internet.
``(e) Technical Assistance.--The Secretary may set aside an
amount not to exceed 1 percent of the total amount
appropriated for a fiscal year to provide grantees with
technical support in the development, implementation, and
evaluation of programs under this section and to disseminate
information about preventing and treating eating disorders
and obesity.
``SEC. 399OO-4. STUDY OF EATING DISORDERS IN ELEMENTARY
SCHOOLS, SECONDARY SCHOOLS, AND INSTITUTIONS OF
HIGHER EDUCATION.
``Not later than 18 months after the date of enactment of
the Federal Response to Eliminate Eating Disorders Act, the
National Center for Health Statistics of the Centers for
Disease Control and Prevention and the National Center for
Education Statistics of the Department of Education shall
conduct a joint study, or enter into a contract to have a
study conducted, on the impact eating disorders have on
educational advancement and achievement. The study shall--
[[Page S2653]]
``(1) determine the incidence of eating disorders and
disordered eating among students, and the morbidity and
mortality rates associated with eating disorders;
``(2) evaluate the extent to which students with eating
disorders are more likely to miss school, have delayed rates
of development, or have reduced cognitive skills;
``(3) report on current State and local programs to
increase awareness about the dangers of eating disorders
among youth and to prevent eating disorders and the risk
factors for eating disorders, and evaluate the value of such
programs; and
``(4) make recommendations on measures that could be
undertaken by Congress, the Department of Education, States,
and local educational agencies to strengthen eating disorder
prevention and awareness programs including development of
best practices.
``SEC. 399OO-5. STUDY OF THE SUITABILITY OF MANDATING BODY
MASS INDEX REPORTING IN ELEMENTARY SCHOOLS AND
SECONDARY SCHOOLS.
``Not later than 18 months after the date of enactment of
the Federal Response to Eliminate Eating Disorders Act, the
Director of the Centers for Disease Control and Prevention,
in consultation with the Secretary of Education, shall
conduct a study on mandatory reporting of body mass index,
including--
``(1) how many schools are currently conducting such
measuring; and
``(2) the impacts on students of such measures, which may
include student and parent reactions to such reports,
including changes in physical activity, a focus on nutrition,
a focus on body image, the use of weight control behaviors,
eating disorder symptoms, and the incidence of teasing or
bullying based on body size.
``SEC. 399OO-6. PUBLIC SERVICE ADVERTISEMENTS.
``The Secretary, in consultation with the Director of the
National Institutes of Health and the Secretary of Education,
shall carry out a program to develop, distribute, and promote
the broadcasting of public service announcements to improve
public awareness of, and to promote the identification and
prevention, of eating disorders.
``SEC. 399OO-7. AUTHORIZATION OF APPROPRIATIONS.
``To carry out sections 399OO-3, 399OO-4, 399OO-5, and
399OO-6, there are authorized to be appropriated such sums as
may be necessary for each of fiscal years 2011 through
2015.''.
SEC. 202. SENSE OF THE SENATE.
It is the sense of the Senate that critically necessary
programs to reduce obesity in children may also
unintentionally increase the unhealthy weight control
behaviors that can lead to development of eating disorders,
and that federally funded programs to combat obesity should
take this connection into consideration.
TITLE III--IMPROVING TRAINING IN HEALTH PROFESSIONS, EDUCATION, AND
RELATED FIELDS
SEC. 301. GRANTS FOR HEALTH PROFESSIONALS.
Part D of title VII of the Public Health Service Act (42
U.S.C. 294 et seq.), as amended by section 4305(c) of the
Patient Protection and Affordable Care Act (Public Law 111-
148), is further amended by adding at the end the following:
``SEC. 760. GRANTS FOR HEALTH PROFESSIONALS.
``(a) Grants.--The Secretary, acting through the Director
of the Health Resources and Services Administration, shall
award grants under this section to develop interdisciplinary
training and education programs that provide undergraduate,
graduate, post-graduate medical, nursing (including advanced
practice nursing students), dental, mental and behavioral
health, pharmacy, and other health professions students or
residents with an understanding of, and clinical skills
pertinent to identifying and treating, eating disorders.
``(b) Eligibility.--To be eligible to receive a grant under
this section an entity shall--
``(1) be an accredited school of allopathic or osteopathic
medicine, or an accredited school of nursing, public health,
social work, dentistry, behavioral and mental health, or
pharmacy, or an accredited medical, dental, or nursing
residency program;
``(2) prepare and submit to the Secretary an application at
such time, in such manner, and containing such information as
the Secretary may require, including--
``(A) information to demonstrate that the applicant will
employ an evidence-based approach for training health
professionals on eating disorders;
``(B) strategies for the dissemination and sharing of
curricula and other educational materials developed under the
grant to other interested health professions schools,
national resource repositories for materials on eating
disorders, and health services continuing education
providers;
``(C) a plan for consulting with community-based
coalitions, treatment centers, or eating disorder research
experts who have experience and expertise in issues related
to eating disorders, for services provided under the program
carried out under the grant; and
``(D) a plan for making the information and curricula
publicly available to health professionals, such as through
the Internet.
``(c) Use of Funds.--
``(1) Required uses.--Amounts provided under a grant
awarded under this section shall be used to fund
interdisciplinary training and education projects that are
designed to train medical, nursing, and other health
professions students and residents to identify and provide
appropriate health care services (including mental or
behavioral health care services and referrals to appropriate
community services) to individuals who have eating disorders.
``(2) Permissive use.--Amounts provided under a grant under
this section may be used to offer community-based training
opportunities in rural areas for medical, nursing, and other
health professions students and residents on eating
disorders, which may include the use of distance learning
networks and other available technologies needed to reach
isolated rural areas.
``(d) Requirements of Grantees.--
``(1) Limitation on administrative expenses.--A grantee
shall not use more than 10 percent of the amounts received
under a grant under this section for administrative expenses.
``(2) Contribution of funds.--A grantee under this section,
and any entity receiving assistance under the grant for
training and education, shall contribute non-Federal funds,
either directly or through in-kind contributions, to the
costs of the activities to be funded under the grant in an
amount that is not less than 10 percent of the total cost of
such activities.
``(e) Eating Disorder.--In this section, the term `eating
disorder' has the meaning given such term in section
399OO(e).
``(f) Authorization of Appropriations.--There are
authorized to be appropriated to carry out this section such
sums as may be necessary for fiscal years 2011 through
2015.''.
SEC. 302. TRAINING IN ELEMENTARY AND SECONDARY SCHOOLS.
Section 5131(a) of the Elementary and Secondary Education
Act of 1965 (20 U.S.C. 7215(a)) is amended by adding at the
end the following:
``(28) Programs to improve the identification of students
with eating disorders (as defined in section 399OO of the
Public Health Service Act), increase awareness of such
disorders among parents and students, and train educators
(including teachers, school nurses, school social workers,
coaches, school counselors, and administrators) on effective
eating disorder prevention, screening, detection and
assistance methods.''.
TITLE IV--IMPROVING AVAILABILITY AND ACCESS TO TREATMENT
SEC. 401. MEDICAID COVERAGE FOR EATING DISORDER TREATMENT
SERVICES.
(a) In General.--Section 1905 of the Social Security Act
(42 U.S.C. 1396d(a)), as amended by section 2301(a)(1) of the
Patient Protection and Affordable Care Act (Public Law 111-
148) and section 1202(b) of the Health Care and Education
Reconciliation Act of 2010 (Public Law 111-152), is amended--
(1) in subsection (a)--
(A) in paragraph (28), by striking ``and'' at the end;
(B) by redesignating paragraph (29) as paragraph (30); and
(C) by inserting after paragraph (28) the following new
paragraph:
``(29) eating disorder treatment services (as defined in
subsection (ee)(1)); and''; and
(2) by adding at the end the following new subsection:
``(ee) Eating Disorder Treatment Services.--
``(1) Definition.--The term `eating disorder treatment
services' means services relating to diagnosis and treatment
of an eating disorder (as defined in section 399OO of the
Public Health Service Act), including screening, counseling,
pharmacotherapy (including coverage of drugs described in
paragraph (2)), and other necessary health care services.
``(2) Coverage for pharmacological treatment of eating
disorders.--For purposes of paragraph (1), eating disorder
treatment services shall include drugs provided as part of
care in an inpatient setting, covered outpatient drugs (as
defined in section 1927(k)(2)), and non-prescription drugs
described in section 1927(d)(2)(A) that are prescribed, in
accordance with generally accepted medical guidelines, for
treatment of an eating disorder.''.
(b) Increased FMAP for Eating Disorder Treatment
Services.--Section 1905(b) of the Social Security Act (42
U.S.C. 1396d(b)), as amended by section 4106(b) of the
Patient Protection and Affordable Care Act, is amended--
(1) by striking ``and'' before ``(5)''; and
(2) by inserting before the period at the end the
following: ``, and (6) the Federal medical assistance
percentage shall be equal to the enhanced FMAP described in
section 2105(b) with respect to medical assistance for eating
disorder treatment services (as defined in subsection
(ee)(1)) provided to an individual who is eligible for such
assistance and has an eating disorder (as defined in section
399OO of the Public Health Service Act)''.
(c) Inclusion in EPSDT Services.--Section 1905(r)(1)(B) of
such Act (42 U.S.C. 1396d(r)(1)(B)) is amended--
(1) in clause (iv), by striking ``and'' at the end;
(2) in clause (v), by striking the period at the end and
inserting ``; and''; and
(3) by inserting after clause (v) the following new clause:
``(vi) appropriate diagnostic services relating to eating
disorders (as defined in section 399OO of the Public Health
Service Act).''.
(d) Exception From Optional Restriction Under Medicaid Drug
Coverage.--Section 1927(d)(2)(A) of such Act (42 U.S.C.
1396r-8(d)(2)(A)) is amended by inserting before the period
at the end the following: ``, except for drugs that are
prescribed, in accordance with generally accepted medical
guidelines, for
[[Page S2654]]
the purpose of treatment of an individual who is eligible for
medical assistance under the State plan and has an eating
disorder (as defined in section 399OO of the Public Health
Service Act)''.
(e) Effective Date.--The amendments made by this section
shall apply to drugs and services furnished on or after
October 1, 2010.
SEC. 402. GRANTS TO SUPPORT PATIENT ADVOCACY.
Subpart II of part D of title IX of the Public Health
Service Act, as amended by section 6301(b) of the Patient
Protection and Affordable Care Act (Public Law 111-148), is
further amended by adding at the end the following:
``SEC. 938. GRANTS TO SUPPORT PATIENT ADVOCACY.
``(a) Grants.--The Secretary, acting through the Director,
shall award grants under this section to develop and support
patient advocacy work to help individuals with eating
disorders obtain adequate health care services and insurance
coverage.
``(b) Eligibility.--To be eligible to receive a grant under
this section, an entity shall--
``(1) be a public or nonprofit private entity (including a
health department of a State or tribal agency, a community-
based organization, or an institution of higher education);
``(2) prepare and submit to the Secretary an application at
such time, in such manner, and containing such information as
the Secretary may require, including--
``(A) comprehensive strategies for advocating on behalf of,
and working with, individuals with eating disorders or at
risk for developing eating disorders;
``(B) a plan for consulting with community-based
coalitions, treatment centers, or eating disorder research
experts who have experience and expertise in issues related
to eating disorders or patient advocacy in providing services
under a grant awarded under this section; and
``(C) a plan for financial sustainability involving State,
local, and private contributions.
``(c) Use of Funds.--Amounts provided under a grant awarded
under this section shall be used to support patient advocacy
work, including--
``(1) providing education and outreach in community
settings regarding eating disorders and associated health
problems, especially among low-income, minority, and
medically underserved populations;
``(2) facilitating access to appropriate, adequate, and
timely health care for individuals with eating disorders and
associated health problems;
``(3) assisting in communication and cooperation between
patients and providers;
``(4) representing the interests of patients in managing
health insurance claims and plans;
``(5) providing education and outreach regarding enrollment
in health insurance, including enrollment in the Medicare
program under title XVIII of the Social Security Act, the
Medicaid program under title XIX of such Act, and the
Children's Health Insurance Program under title XXI of such
Act;
``(6) identifying, referring, and enrolling underserved
populations in appropriate health care agencies and
community-based programs and organizations in order to
increase access to high-quality health care services;
``(7) providing technical assistance, training, and
organizational support for patient advocates; and
``(8) creating, operating, and participating in State or
regional networks of patient advocates.
``(d) Requirements of Grantees.--
``(1) Limitation on administrative expenses.--A grantee
shall not use more than 5 percent of the amounts received
under a grant under this section for administrative expenses.
``(2) Contribution of funds.--A grantee under this section,
and any entity receiving assistance under the grant for
training and education, shall contribute non-Federal funds,
either directly or through in-kind contributions, to the
costs of the activities to be funded under the grant in an
amount that is not less than 75 percent of the total cost of
such activities.
``(3) Reporting to secretary.--A grantee under this section
shall submit to the Secretary a report, at such time, in such
manner, and containing such information as the Secretary may
require, including a description and evaluation of the
activities described in subsection (c) carried out by such
entity.
``(e) Eating Disorder.--In this section, the term `eating
disorder' has the meaning given such term in section
399OO(e).
``(f) Authorization of Appropriations.--To carry out this
section, there are authorized to be appropriated such sums as
may be necessary for fiscal years 2011 through 2015.''.
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