[Congressional Record Volume 156, Number 66 (Wednesday, May 5, 2010)]
[Senate]
[Pages S3172-S3279]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                           TEXT OF AMENDMENTS

  SA 3815. Mr. DORGAN (for himself and Mr. Grassley) submitted an 
amendment intended to be proposed to amendment SA 3739 proposed by Mr. 
Reid (for Mr. Dodd (for himself and Mrs. Lincoln)) to the bill S. 3217, 
to promote the financial stability of the United States by improving 
accountability and transparency in the financial system, to end ``too 
big to fail'', to protect the American taxpayer by ending bailouts, to 
protect consumers from abusive financial services practices, and for 
other purposes; which was ordered to lie on the table; as follows:

       On page 1533, line 5, strike ``Section'' and insert the 
     following:
       ``(a) In General.--Not later than 60 days after the date of 
     enactment of this Act, the Board of Governors shall disclose 
     to Congress and to the public, with respect to any

[[Page S3173]]

     emergency financial assistance provided during the 5-year 
     period preceding the date of enactment of this Act under the 
     authority of the Board of Governors in the third undesignated 
     paragraph of section 13 of the Federal Reserve Act (12 U.S.C. 
     343)--
       ``(1) the name of each financial company that received such 
     assistance;
       ``(2) the value or amount and description of the emergency 
     assistance provided, including loans to investment banks from 
     the Federal Reserve discount lending program or special 
     purpose entities;
       ``(3) the date on which the financial assistance was 
     provided;
       ``(4) the terms and conditions for the emergency 
     assistance; and
       ``(5) a full description of any collateral required by the 
     Board of Governors and secured from the recipients of such 
     emergency assistance.
         ``(b) Public Disclosure.--Section''.
                                 ______
                                 
  SA 3816. Mr. CHAMBLISS (for himself, Mr. Shelby, Mr. McConnell, Mr. 
Gregg, Mr. Crapo, Mr. Johanns, Mr. Cochran, Mrs. Hutchison, Mr. Cornyn, 
Mr. Roberts, Mr. Bennett, Mr. Vitter, and Mr. Thune) submitted an 
amendment intended to be proposed to amendment SA 3739 proposed by Mr. 
Reid (for Mr. Dodd (for himself and Mrs. Lincoln)) to the bill S. 3217, 
to promote the financial stability of the United States by improving 
accountability and transparency in the financial system, to end ``too 
big to fail'', to protect the American taxpayer by ending bailouts, to 
protect consumers from abusive financial services practices, and for 
other purposes; which was ordered to lie on the table; as follows:

       Strike title VII and insert the following:

             TITLE VII--OVER-THE-COUNTER DERIVATIVES MARKET

     SEC. 701. SHORT TITLE; PURPOSES.

       (a) Short Title.--This title may be cited as the ``Over-
     the-Counter Swaps Markets Transparency and Accountability Act 
     of 2010''.
       (b) Purposes.--The purposes of this title are--
       (1) to improve regulators' access to information by 
     establishing well-regulated repositories for the reporting of 
     all swaps;
       (2) to repeal the statutory provisions that prohibit 
     regulators from overseeing the over-the-counter swaps 
     markets;
       (3) to increase the number of derivatives transactions that 
     are centrally cleared;
       (4) to ensure that corporate end users can continue to 
     hedge their unique business risks through customized 
     derivatives;
       (5) to prevent concentration of inadequately hedged risks 
     in individual firms or central clearinghouses; and
       (6) to provide investors and other swap market participants 
     with information about transactions and positions in order to 
     help them mark existing swap positions to market, make 
     informed decisions before executing future transactions, and 
     assess the quality of transactions they have executed.

                    Subtitle A--Regulatory Authority

     SEC. 711. DEFINITIONS.

       In this subtitle, the terms ``prudential regulator'', 
     ``swap'', ``swap participant'', ``swap data repository'', 
     ``associated person of a swap participant'', ``eligible 
     contract participant'', ``non-security-based swap execution 
     facility'', ``broad-based security index'', ``non-security-
     based swap'', ``non-security-based swap data repository'', 
     ``security-based swap'', and ``security-based swap data 
     repository'' have the meanings given the terms in section 1a 
     of the Commodity Exchange Act (7 U.S.C. 1a).

     SEC. 712. REVIEW OF REGULATORY AUTHORITY.

       (a) Consultation.--
       (1) Rules; orders.--In developing and promulgating rules or 
     orders pursuant to this subsection--
       (A) the Commodity Futures Trading Commission shall consider 
     the views of--
       (i) the Securities and Exchange Commission; and
       (ii) the prudential regulators; and
       (B) the Securities and Exchange Commission shall consider 
     the views of--
       (i) the Commodity Futures Trading Commission; and
       (ii) the prudential regulators.
       (2) Treatment of similar products and entities.--
       (A) In general.--In adopting rules and orders under this 
     subsection, the Commodity Futures Trading Commission and the 
     Securities and Exchange Commission shall treat functionally 
     or economically similar products or entities described in 
     paragraphs (1) and (2) in a similar manner.
       (B) Effect.--Nothing in this subtitle requires the 
     Commodity Futures Trading Commission or the Securities and 
     Exchange Commission to adopt joint rules or orders that treat 
     functionally or economically similar products or entities 
     described in paragraphs (1) and (2) in an identical manner.
       (b) Global Rulemaking Timeframe.--Unless otherwise provided 
     in a particular provision of this title, or an amendment made 
     by this title, the Commodity Futures Trading Commission or 
     the Securities and Exchange Commission, or both, shall 
     promulgate rules and regulations required of each Commission 
     under this title or an amendment made by this title not later 
     than 1 year after the date of enactment of this Act.
       (c) Regulatory Authority.--The Commodity Futures Trading 
     Commission and the Securities and Exchange Commission shall 
     prescribe such regulations as may be necessary to carry out 
     the provisions of this title.

     SEC. 713. DETERMINATION OF STATUS OF NEW PRODUCTS.

       (a) In General.--If the Securities and Exchange Commission 
     and the Commodity Futures Trading Commission are unable to 
     determine whether any new product is a security, future, 
     option on a future, security-based swap, or non-security-
     based swap, either agency may petition the Financial 
     Stability Oversight Council (referred to in this Act as the 
     ``Council'') for a binding determination of the status of the 
     new product as a security, future, option on a future, 
     security-based swap, or non-security-based swap.
       (b) Deadline for Determination.--The Council shall issue 
     its determination within 60 days after the date of receipt of 
     a petition described in subsection (a).

     SEC. 714. STUDY ON ENFORCEMENT CONSISTENCY.

       (a) Study.--The Council shall conduct a study to compare 
     the nature and amount of penalties and other sanctions 
     imposed for violations of this title and any regulations 
     adopted thereunder.
       (b) Report.--Not later than 4 years after the enactment of 
     this Act, the Council shall submit a report to the Committee 
     on Agriculture, Nutrition, and Forestry and the Committee on 
     Banking, Housing, and Urban Affairs of the Senate, and the 
     Committee on Agriculture and the Committee on Financial 
     Services of the House of Representatives that sets forth--
       (1) the findings of the study required under subsection 
     (a); and
       (2) recommendations for statutory changes to enhance the 
     consistency with which this Act and the regulations adopted 
     thereunder are enforced.

     SEC. 715. JURISDICTION.

       (a) The provisions of this title shall not apply to 
     activities outside the United States, unless those 
     activities--
       (1) have a direct and significant connection with 
     activities in, or an effect on, United States commerce; or
       (2) contravene such rules or regulations as the Securities 
     and Exchange Commission and Commodity Futures Trading 
     Commission may jointly, by rule or regulation, prescribe as 
     necessary or appropriate to prevent the evasion of any 
     provision of this Act.
       (b) The Commodity Futures Trading Commission and the 
     Securities and Exchange Commission may exempt a person from 
     some or all requirements of this title, if they jointly 
     determine by rule or order that the person is subject to 
     comparable requirements as part of comprehensive supervision 
     and regulation on a consolidated basis by an appropriate 
     regulatory authority in a foreign jurisdiction and such 
     regulatory authority has entered into an information sharing 
     agreement with the Commodity Futures Trading Commission and 
     the Securities and Exchange Commission.

     SEC. 716. INTERNATIONAL HARMONIZATION.

       (a) International Standards.--The Department of the 
     Treasury shall consult and coordinate with foreign regulatory 
     authorities on the establishment of consistent international 
     standards with respect to the regulation of swaps, swap 
     market participants, swap data repositories, and central 
     clearing entities.
       (b) International Information-Sharing Agreements.--Nothing 
     in subsection (a) shall be construed to prohibit the 
     Commodity Futures Trading Commission and the Securities and 
     Exchange Commission, from entering into information-sharing 
     arrangements with foreign regulators as may be deemed to be 
     necessary in furtherance of the purposes of this title.

     SEC. 717. CONFIDENTIALITY OF INFORMATION.

       (a) Confidentiality of Information Provided to Members of 
     Congress.--The Committee on Agriculture, Nutrition, and 
     Forestry and the Committee on Banking, Housing, and Urban 
     Affairs of the Senate and the Committee on Agriculture and 
     the Committee on Financial Services of the House of 
     Representatives shall each establish, by rule or resolution 
     of such House, procedures to protect from unauthorized 
     disclosure all confidential information (including 
     information covered by sections 1905 and 1906 of title 18, 
     United States Code,) that is furnished to the committees and 
     Members of Congress under this title. Such procedures shall 
     be established in consultation with the appropriate 
     regulatory agencies.
       (b) Confidentiality of Information Provided to 
     Regulators.--No non-public information provided to or 
     obtained by the Commodity Futures Trading Commission, the 
     Securities and Exchange Commission, any prudential regulator, 
     the Financial Stability Oversight Council, or the Department 
     of Justice under this title may be disclosed to any other 
     person. Nothing in this section shall authorize the Commodity 
     Futures Trading Commission, the Securities and Exchange 
     Commission, any prudential regulator, the Financial Stability 
     Oversight Council, or the Department of Justice to withhold 
     information from Congress, or prevent the Commodity Futures 
     Trading Commission, the Securities and Exchange Commission, 
     any prudential regulator, the Financial Stability Oversight 
     Council, or the Department of Justice from complying with a 
     request for information from any other Federal department or 
     agency.

[[Page S3174]]

     SEC. 718. COMMON FRAMEWORK FOR CLEARINGHOUSE RISK MANAGEMENT.

       (a) Common Framework for Risk Management.--The Commodity 
     Futures Trading Commission and the Securities and Exchange 
     Commission shall consult with the Federal Reserve Board of 
     Governors to jointly develop risk management supervision 
     programs for derivatives clearing organizations and clearing 
     agencies (``clearinghouses''). Not later than 1 year after 
     the date of enactment of this Act, the Commodity Futures 
     Trading Commission, the Securities and Exchange Commission, 
     and the Federal Reserve Board of Governors shall submit a 
     joint report to the Committee on Banking, Housing, and Urban 
     Affairs and the Committee on Agriculture, Nutrition, and 
     Forestry of the Senate, and the Committee on Financial 
     Services and the Committee on Agriculture of the House of 
     Representatives recommendations for--
       (1) improving consistency in the clearinghouse oversight 
     programs of the Securities and Exchange Commission and the 
     Commodity Futures Trading Commission;
       (2) promoting robust risk management by clearinghouses;
       (3) promoting robust risk management oversight by 
     regulators of clearinghouses; and
       (4) improving regulators' ability to monitor the potential 
     effects of clearinghouse risk management on the stability of 
     the financial system of the United States.
       (b) Dually Registered Persons.--
       (1) In general.--The Commodity Futures Trading Commission 
     and the Securities and Exchange Commission shall develop and, 
     subject to approval by the Council, implement an oversight 
     plan with respect to each person that is subject to 
     registration as--
       (A) both a derivatives clearing organization and a clearing 
     agency; or
       (B) both a non-security-based swap data repository and 
     security-based swap data repository.
       (2) Contents of plans.--Each plan shall identify 
     recordkeeping, reporting and other requirements imposed on 
     the person by the Commodity Futures Trading Commission and 
     the Securities and Exchange Commission that are inconsistent, 
     an approach for eliminating inconsistencies where 
     appropriate, and ways in which the two commissions can 
     coordinate their inspection and examination of the person. 
     Such plan, if appropriate, may designate one regulator as the 
     person's primary regulator.
       (3) Submission of plans.--The Commissions shall submit each 
     plan, including any recommended legislative changes to 
     facilitate the plan, to the Committee on Agriculture, 
     Nutrition, and Forestry and the Committee on Banking, 
     Housing, and Urban Affairs of the Senate and the Committee on 
     Agriculture and the Committee on Financial Services of the 
     House of Representatives on or before 1 year after the date 
     on which the person becomes dually registered.

     SEC. 719. RECOMMENDATIONS FOR CHANGES TO PORTFOLIO MARGINING 
                   LAWS.

       Not later than 1 year after the date of enactment of this 
     Act, the Securities and Exchange Commission, the Commodity 
     Futures Trading Commission, and the prudential regulators 
     shall submit to the Committee on Agriculture, Nutrition, and 
     Forestry and the Committee on Banking, Housing, and Urban 
     Affairs of the Senate and the Committee on Agriculture and 
     the Committee on Financial Services of the House of 
     Representatives recommendations for legislative changes to 
     the Federal laws to facilitate--
       (1) the portfolio margining of securities and commodity 
     futures and options, commodity options, swaps, and other 
     financial instrument positions;
       (2) the portability of customer swap positions and 
     associated margin upon the insolvency of a clearing 
     participant; and
       (3) harmonization of the insolvency laws to provide for 
     uniform treatment across similar entities, regardless of 
     whether they are registered with or regulated by the 
     Securities and Exchange Commission or the Commodity Futures 
     Trading Commission.

     SEC. 720. ABUSIVE SWAPS.

       The Council may, by rule or order--
       (1) collect information as may be necessary concerning the 
     markets for any types of swaps; and
       (2) issue a report with respect to any types of swaps that 
     the Council determines to be detrimental to the financial 
     system stability of the United States.

       Subtitle B--Regulation Non-Security-Based of Swap Markets

     SEC. 721. DEFINITIONS.

       (a) In General.--Section 1a of the Commodity Exchange Act 
     (7 U.S.C. 1a) is amended--
       (1) by redesignating paragraphs (2), (3) through (17), (18) 
     through (23), (24) through (28), (29), (30), (31) through 
     (33), and (34) as paragraphs (5), (8) through (22), (26) 
     through (31), (34) through (38), (40), (41), (43) through 
     (45), and (49), respectively;
       (2) by inserting after paragraph (1) the following:
       ``(2) Appropriate federal banking agency.--The term 
     `appropriate Federal banking agency' has the meaning given 
     the term in section 3 of the Federal Deposit Insurance Act 
     (12 U.S.C. 1813).
       ``(3) Associated person of a swap participant.--
       ``(A) In general.--The term `associated person of a swap 
     participant' means--
       ``(i) any partner, officer, director, or branch manager of 
     a swap participant (including any individual who holds a 
     similar status or performs a similar function with respect to 
     any partner, officer, director, or branch manager of a swap 
     participant);
       ``(ii) any person that directly or indirectly controls, is 
     controlled by, or is under common control with, a swap 
     participant; and
       ``(iii) any employee of a swap participant.
       ``(B) Exclusion.--Other than for purposes of section 
     4s(b)(6), the term `associated person of a swap participant' 
     does not include any person associated with a swap 
     participant the functions of which are solely clerical or 
     ministerial.
       ``(4) Board.--The term `Board' means the Board of Governors 
     of the Federal Reserve System.'';
       (3) by inserting after paragraph (5) (as redesignated by 
     paragraph (1)) the following:
       ``(6) Broad-based security index.--The term `broad-based 
     security index' means an index that--
       ``(A) is not a narrow-based security index, as defined in 
     this section; or
       ``(B) the Commission and the Securities and Exchange 
     Commission have jointly determined should not be treated as a 
     narrow-based security index.
       ``(7) Cleared swap.--The term `cleared swap' means any swap 
     that is, directly or indirectly, submitted to and cleared by 
     a derivatives clearing organization registered with the 
     Commission or a clearing agency regulated with the Securities 
     and Exchange Commission.'';
       (4) in paragraph (10) (as redesignated by paragraph (1)), 
     by inserting ``security futures product, or non-security-
     based swap'' after ``facility,'';
       (5) in paragraph (11)(A)(i)(I) (as redesignated by 
     paragraph (1)), by striking ``made or to be made on or 
     subject to the rules of a contract market or derivatives 
     transaction execution facility'' and inserting ``, security 
     futures product, or non-security-based swap'';
       (6) in paragraph (16) (as redesignated by paragraph (1)) in 
     subparagraph (A), in the matter preceding clause (i), by 
     striking ``paragraph (12)(A)'' and inserting ``paragraph 
     (17)(A)'';
       (7) in paragraph (17) (as redesignated by paragraph (1))--
       (A) in subparagraph (A)--
       (i) in the matter following clause (vii)(III)--

       (I) by striking ``section 1a (11)(A)'' and inserting 
     ``paragraph (16)(A)''; and
       (II) by striking ``$25,000,000'' and inserting 
     ``$50,000,000''; and

       (ii) in clause (xi), in the matter preceding subclause (I), 
     by striking ``total assets in an amount'' and inserting 
     ``amounts invested on a discretionary basis, the aggregate of 
     which is'';
       (8) in paragraph (21) (as redesignated by paragraph (1)), 
     by inserting ``security futures product, or non-security-
     based swap'' after ``of any contract market or derivatives 
     transaction execution facility'';
       (9) in paragraph (22) (as redesignated by paragraph (1)), 
     by inserting ``, security futures product, or non-security-
     based swap'' after ``of any contract market or derivatives 
     transaction execution facility'';
       (10) by inserting after paragraph (22) (as redesignated by 
     paragraph (1)) the following:
       ``(23) Foreign exchange forward.--The term `foreign 
     exchange forward' means a transaction that--
       ``(A) occurs at a later time on the trade date or on a 
     specific future date; and
       ``(B) solely involves--
       ``(i) the exchange of 2 different currencies at a fixed 
     rate agreed to at the inception of the contract; or
       ``(ii) 1 or more payments determined by reference to the 
     rate of exchange of 2 different currencies, or the movement 
     thereof in accordance with a method agreed to at the 
     inception of a contract.
       ``(24) Foreign exchange swap.--The term `foreign exchange 
     swap' means a transaction that does not involve any payment 
     or delivery based on the level of interest rates, the price 
     of any commodity other than a currency, or the price of, or 
     default under, any debt or equity security or loan and solely 
     involves--
       ``(A) the exchange of 2 different currencies at a fixed 
     rate agreed to at the inception of the contract that occurs 
     at a later time on the trade date or on a specific future 
     date and a reverse exchange of the same currencies at a date 
     further in the future; or
       ``(B) 1 or more payments determined by reference to the 
     rate of exchange of 2 different currencies, or the movement 
     thereof in accordance with a method agreed to at the 
     inception of the contract, at a later time on the trade date 
     or on a specific future date and a payment at a date further 
     in the future that is determined by reference to the rate of 
     exchange of the same currencies or the movement thereof in 
     accordance with a method agreed to at the inception of the 
     contract.
       ``(25) Foreign exchange option.--The term `foreign exchange 
     option' means a transaction, including a put or a call, that 
     solely entitles the buyer, upon exercise, on a specified date 
     or upon a specified event--
       ``(A) to purchase from the seller a specified quantity or 1 
     or more currencies and to sell to the seller a specified 
     quantity of 1 or more currencies; or
       ``(B) to require the seller to make a payment determined by 
     reference to the exchange rate of such currencies or the 
     movement thereof in accordance with a method agreed to at the 
     inception of the contract.'';

[[Page S3175]]

       (11) in paragraph (28) (as redesignated by paragraph (1))--
       (A) in subparagraph (A)--
       (i) by inserting ``, security futures product, or non-
     security-based swap'' after ``facility''; and
       (ii) by striking ``; and'' and inserting a semicolon;
       (B) in subparagraph (B), by striking the period at the end 
     and inserting ``; and''; and
       (C) by adding at the end the following:
       ``(C) Exclusion.--The term `futures commission merchant' 
     does not include a person who acts only as a counterparty for 
     non-security-based swaps with eligible contract participants 
     and who does not otherwise engage in the activities of a 
     futures commission merchant.'';
       (12) in paragraph (30) (as redesignated by paragraph (1)), 
     in subparagraph (B), by striking ``state'' and inserting 
     ``State'';
       (13) in paragraph (31) (as redesignated by paragraph (1)), 
     by inserting ``security futures product, or non-security-
     based swap,'' after ``facility'';
       (14) by inserting after paragraph (31) (as redesignated by 
     paragraph (1)) the following:
       ``(32) Swap participant.--
       ``(A) In general.--The term `swap participant' means any 
     person who--
       ``(i) is engaged in the business of purchasing or selling 
     swaps for such person's own account or for others;
       ``(ii) is making a market in swaps; or
       ``(iii) engages in transactions in swaps and is not a swap 
     end user.
       ``(B) Exceptions.--A person shall not be deemed to be a 
     swap participant pursuant to subparagraph (A)--
       ``(i) solely because that person buys or sells swaps for 
     such person's own account or the account of any person under 
     common control with such person, either individually or in a 
     fiduciary capacity, but not as a part of a regular business; 
     or
       ``(ii) if that person engages in a de minimis quantity of 
     activities described in subparagraph (A) in connection with 
     transactions with or on behalf of customers.
       ``(33) Swap end user.--
       ``(A) In general.--The term `swap end user' means any 
     person the gross aggregate notional value of whose 
     outstanding swaps that do not qualify as bona fide hedging 
     swap transactions--
       ``(i) is 5 percent or less of the gross aggregate notional 
     value of the person's outstanding swaps; or
       ``(ii) is 7 percent or less of the gross aggregate notional 
     value of the person's outstanding swaps and security-based 
     swaps, provided that the aggregate notional value of the 
     person's outstanding swaps and security-based swaps that do 
     not qualify as bona fide hedging transactions and were 
     executed in connection with the person's commercial 
     transactions is 2 percent or more of the gross aggregate 
     notional value of the person's outstanding swaps.
       ``(B) Enumerated swap end users.--The term `swap end user' 
     shall include--
       ``(i) an investment company registered under the Investment 
     Company Act of 1940 (15 U.S.C. 80a-1 et seq.); and
       ``(ii) an employee benefit plan as defined in section 3(3) 
     of the Employee Retirement Income Security Act of 1974 (29 
     U.S.C. 1002(3)) that is subject to title I of that Act (29 
     U.S.C. 1001 et seq.).
       ``(C) Enumerated exceptions.--The term `swap end user' 
     shall not include--
       ``(i) entities defined in section 1303(20) of the Federal 
     Housing Enterprises Financial Safety and Soundness Act of 
     1992 (12 U.S.C. 4502(20)); or
       ``(ii) an investment fund that would be an investment 
     company (as defined in section 3 of the Investment Company 
     Act o f 1940 (15 U.S.C. 80a-3)) but for paragraph (1) or (7) 
     of section 3(c) of that Act (15 U.S.C. 80a-3(c)), and is not 
     a partnership or other entity or any subsidiary that is 
     primarily invested in physical assets (which shall include 
     but not be limited to commercial real estate) directly or 
     through interests in partnerships or limited liability 
     companies that own such assets.
       ``(D) Availability of information.--Upon written request 
     from the Commission, the Securities and Exchange Commission, 
     or the Financial Stability Oversight Council, a swap end user 
     must provide information regarding the swaps that it holds. 
     This information may not be disclosed to any other person. 
     Nothing in this subsection shall authorize the Commission, 
     the Securities and Exchange Commission, or the Financial 
     Stability Oversight Council to withhold information from 
     Congress, or prevent the Commission, the Securities and 
     Exchange Commission, or the Financial Stability Oversight 
     Council from complying with a request for information from 
     any other Federal department or agency or foreign government 
     with which the Commission, the Securities and Exchange 
     Commission, or the Financial Stability Oversight Council has 
     an information sharing arrangement that requests the 
     information for purposes within the scope of its 
     jurisdiction, or complying with an order of a court of the 
     United States in an action brought by the United States or 
     the Commission.
       ``(33A) Bona fide hedging swap transaction.--
       ``(A) In general.--The term `bona fide hedging swap 
     transaction' means a purchase or sale by any person of a bona 
     fide swap that is economically appropriate to the reduction 
     or offsetting of risks arising from--
       ``(i) the potential change in the value of assets which 
     such person owns, produces, manufactures, processes, or 
     merchandises or anticipates owning, producing, manufacturing, 
     processing, or merchandising;
       ``(ii) the potential change in the cost or value of 
     liabilities which such person owns or anticipates incurring; 
     or
       ``(iii) the potential change in the cost or value of goods 
     or services which such person provides, purchases, or 
     anticipates providing or purchasing.
       ``(B) Prevention of evasion.--A swap transaction that is 
     undertaken solely for the purpose of avoiding registration as 
     a swap participant shall not constitute a bona fide hedging 
     swap transaction.'';
       (15) by inserting after paragraph (38) (as redesignated by 
     paragraph (1)) the following:
       ``(39) Prudential regulator.--The term `prudential 
     regulator' means--
       ``(A) the Office of the Comptroller of the Currency, in the 
     case of--
       ``(i) any national banking association;
       ``(ii) any Federal branch or agency of a foreign bank; or
       ``(iii) any Federal savings association;
       ``(B) the Federal Deposit Insurance Corporation, in the 
     case of--
       ``(i) any insured State bank;
       ``(ii) any foreign bank having an insured branch; or
       ``(iii) any State savings association;
       ``(C) the Board of Governors of the Federal Reserve System, 
     in the case of--
       ``(i) any noninsured State member bank;
       ``(ii) any branch or agency of a foreign bank with respect 
     to any provision of the Federal Reserve Act (12 U.S.C. 221 et 
     seq.) which is made applicable under the International 
     Banking Act of 1978 (12 U.S.C. 3101 et seq.);
       ``(iii) any foreign bank which does not operate an insured 
     branch;
       ``(iv) any agency or commercial lending company other than 
     a Federal agency; or
       ``(v) supervisory or regulatory proceedings arising from 
     the authority given to the Board of Governors under section 
     7(c)(1) of the International Banking Act of 1978 (12 U.S.C. 
     3105(c)(1)), including such proceedings under the Financial 
     Institutions Supervisory Act of 1966 (12 U.S.C. 1464 et 
     seq.);
       ``(D) the Federal Housing Finance Agency, in the case of a 
     swap participant that is a regulated entity (as defined in 
     section 1303(20) of the Federal Housing Enterprises Financial 
     Safety and Soundness Act of 1992 (12 U.S.C. 4502(20))); and
       ``(E) the Farm Credit Administration, in the case of a swap 
     participant that is an institution chartered under the Farm 
     Credit Act of 1971 (12 U.S.C. 2001 et seq.).'';
       (16) in paragraph (40) (as redesignated by paragraph (1))--
       (A) by striking subparagraph (B);
       (B) by redesignating subparagraphs (C), (D), and (E) as 
     subparagraphs (B), (C), and (F), respectively;
       (C) in subparagraph (C) (as so redesignated), by striking 
     ``and'';
       (D) by inserting after subparagraph (C) (as so 
     redesignated) the following:
       ``(D) a non-security-based swap execution facility 
     registered under section 5h;
       ``(E) a non-security-based swap data repository; and'';
       (17) by inserting after paragraph (41) (as redesignated by 
     paragraph (1)) the following:
       ``(42) Security-based swap.--The term `security-based swap' 
     has the meaning given the term in section 3(a) of the 
     Securities Exchange Act of 1934 (15 U.S.C. 78c(a)).
       ``(42A) Non-security-based swap.--The term `non-security-
     based swap' means any swap that is not a security-based 
     swap.'';
       (18) in paragraph (45) (as redesignated by paragraph (1)), 
     by striking ``subject to section 2(h)(7)'' and inserting 
     ``subject to section 2(h)(5)'';
       (19) by inserting after paragraph (45) (as redesignated by 
     paragraph (1)) the following:
       ``(46) Swap.--
       ``(A) In general.--The term `swap' means any agreement, 
     contract, or transaction that--
       ``(i) is a put, call, cap, floor, collar, or similar option 
     of any kind that is for the purchase or sale, or based on the 
     value, of 1 or more interest or other rates, currencies, 
     commodities, securities, instruments of indebtedness, 
     indices, quantitative measures, or other financial or 
     economic interests or property of any kind;
       ``(ii) provides for any purchase, sale, payment, or 
     delivery (other than a dividend on an equity security) that 
     is dependent on the occurrence, nonoccurrence, or the extent 
     of the occurrence of an event or contingency associated with 
     a potential financial, economic, or commercial consequence;
       ``(iii) provides on an executory basis for the exchange, on 
     a fixed or contingent basis, of 1 or more payments based on 
     the value or level of 1 or more interest or other rates, 
     currencies, commodities, securities, instruments of 
     indebtedness, indices, quantitative measures, or other 
     financial or economic interests or property of any kind, or 
     any interest therein or based on the value thereof, and that 
     transfers, as between the parties to the transaction, in 
     whole or in part, the financial risk associated with a future 
     change in any such value or level without also conveying a 
     current or future direct or indirect ownership interest in an 
     asset (including any enterprise or investment pool) or 
     liability that incorporates the financial risk so 
     transferred, including any agreement, contract, or 
     transaction commonly known as--

       ``(I) an interest rate swap;
       ``(II) a rate floor;
       ``(III) a rate cap;
       ``(IV) a rate collar;

[[Page S3176]]

       ``(V) a cross-currency rate swap;
       ``(VI) a basis swap;
       ``(VII) a currency swap;
       ``(VIII) a foreign exchange swap;
       ``(IX) a total return swap;
       ``(X) a broad-based security index swap;
       ``(XI) an equity index swap;
       ``(XII) an equity swap;
       ``(XIII) a debt index swap;
       ``(XIV) a debt swap;
       ``(XV) a credit spread;
       ``(XVI) a credit default swap;
       ``(XVII) a credit swap;
       ``(XVIII) a weather swap;
       ``(XIX) an energy swap;
       ``(XX) a metal swap;
       ``(XXI) an agricultural swap;
       ``(XXII) an emissions swap; and
       ``(XXIII) a commodity swap;

       ``(iv) provides for the purchase or sale, on a fixed, 
     contingent, or variable basis, of any commodity, currency, 
     instrument, interest, right, service, good, article, or 
     property of any kind;
       ``(v) is an agreement, contract, or transaction that is, or 
     in the future becomes, commonly known to the trade as a swap; 
     or
       ``(vi) is any combination or permutation of, or option on, 
     any agreement, contract, or transaction described in clauses 
     (i) through (v).
       ``(B) Exclusions.--The term `swap' does not include--
       ``(i) any contract of sale of a commodity for future 
     delivery traded on or subject to the rules of any board of 
     trade designated as a contract market under section 5 or 5f;
       ``(ii) any purchase or sale of a nonfinancial commodity for 
     deferred or delayed shipment or delivery, so long as the 
     transaction provides for physical delivery and is undertaken 
     as part of, or in contemplation of, commercial or 
     merchandising activities;
       ``(iii) any put, call, straddle, option, or privilege on 
     any security, certificate of deposit, or group or index of 
     securities, including any interest therein or based, in whole 
     or in part, on the value thereof, whether physically or cash 
     settled, unless such agreement, contract, or transaction 
     predicates such purchase or sale (or a net cash payment in 
     lieu thereof) on the occurrence of a bona fide contingency 
     that might reasonably be expected to affect or be affected by 
     the creditworthiness of 1 or more reference entities;
       ``(iv) any agreement, contract, or transaction that is 
     executed or traded on a national securities exchange 
     registered pursuant to section 6(a) of the Securities 
     Exchange Act of 1934 (15 U.S.C. 78f(a));
       ``(v) any purchase or sale of 1 or more securities on a 
     non-contingent basis for deferred or delayed delivery;
       ``(vi) any agreement, contract, or transaction providing 
     for the purchase or sale of 1 or more securities (or a net 
     cash payment in lieu thereof) on a contingent basis, unless 
     such agreement, contract, or transaction predicates such 
     purchase or sale (or a net cash payment in lieu thereof) on 
     the occurrence of a bona fide contingency that might 
     reasonably be expected to affect or be affected by the 
     creditworthiness of 1 or more reference entities;
       ``(vii) any agreement, contract, or transaction for the 
     purchase or sale, on an immediate settlement basis within the 
     relevant regular way settlement cycle, of any currency, 
     commodity, security, instrument of indebtedness, financial 
     instrument, or property of any kind, or any interest therein;
       ``(viii) any note, bond, or evidence of indebtedness that 
     is a security as defined in section 2(a)(1) of the Securities 
     Act of 1933 (15 U.S.C. 77b(a)(1)) or paragraph (10) of this 
     subsection, or that would be a `swap' pursuant to section 
     3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 
     78c(a)) solely as a result of bearing a variable rate of 
     return;
       ``(ix) any agreement, contract, or transaction that is--

       ``(I) based on, or references, a security; and
       ``(II) entered into directly or through an underwriter (as 
     defined in section 2(a)(11) of the Securities Act of 1933) 
     (15 U.S.C. 77b(a)(11)) by the issuer of such security;

       ``(x) any security futures product;
       ``(xi) any agreement, contract, or transaction that is--

       ``(I) predominantly a banking product as provided in 
     section 405 of the Commodity Futures Modernization Act of 
     2000 (Public Law 106-554; 114 Stat. 2763A-455);
       ``(II) not marketed or sold as an alternative to a swap; 
     and
       ``(III) issued or sold by a bank as defined in section 3(a) 
     of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a));

       ``(xii) any hybrid instrument that is predominantly a 
     security as provided in section 2(f) as in effect on the day 
     before the date of enactment of this paragraph;
       ``(xiii)(I) any identified banking product specified in 
     paragraphs (1) through (5) of section 206(a) of the Gramm-
     Leach-Bliley Act (15 U.S.C. 78c(a)), that is--

       ``(aa) not marketed or sold as an alternative to a swap, 
     and
       ``(bb) issued or sold by a bank, as defined in section 3(a) 
     of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)); or

       ``(II) any agreement, contract, or transaction executed in 
     conjunction with an identified banking product described in 
     subclause (I), between a bank and a borrower that is not an 
     eligible contract participant to convert the variable rate 
     interest cost of debt to a fixed rate interest cost or vice 
     versa, or to limit the maximum interest cost of such debt;
       ``(xiv) any mortgage or mortgage purchase commitment, or 
     any sale of installment loan contracts or receivables, if 
     such product or instrument is not marketed or sold as an 
     alternative to a swap;
       ``(xv) any contract, agreement or transaction that provides 
     a crediting interest rate and guaranty or financial assurance 
     of liquidity at contract or book value prior to maturity 
     offered by a bank or insurance company for the benefit of any 
     individual or commingled fund available as an investment in a 
     defined contribution plan (as defined in section 3(34) of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1002(34)) or a qualified tuition program (as defined in 
     section 529 of the Internal Revenue Code of 1986 (26 U.S.C. 
     529));
       ``(xvi) any agreement, contract, or transaction a 
     counterparty of which is a Federal Reserve bank, the United 
     States government, a foreign central bank, or a foreign 
     government;
       ``(xvii) any agreement, contract, or transaction for the 
     performance of services;
       ``(xviii) any agreement, contract, or transaction that is 
     commercial in nature or employment-related, that is not 
     marketed as a swap, and that would otherwise be a `swap' 
     pursuant to subparagraph (A) solely as a result of an 
     incidental price, compensation, or rate escalation clause;
       ``(xix) any agreement, contract, or transaction--

       ``(I) under which a payment or performance is dependent on 
     the occurrence, non-occurrence, or the extent of the 
     occurrence of a contingency beyond the direct control of the 
     parties to the agreement, contract, or transaction and which 
     conditions such payment or performance obligation on the 
     incurrence of a loss arising from such contingency; and
       ``(II) that is an insurance or endowment policy or annuity 
     contract or optional annuity contract issued by a corporation 
     that is subject to the supervision of the insurance 
     commissioner, bank commissioner, or any agency or officer 
     performing like functions, of any State or territory of the 
     United States or the District of Columbia, unless such 
     agreement, contract, or transaction predicates such purchase 
     or sale (or a net cash payment in lieu thereof) on the 
     occurrence of a bona fide contingency that might reasonably 
     be expected to affect or be affected by the creditworthiness 
     of one or more reference entities;

       ``(xx) any agreement, contract, or transaction that the 
     Commission, jointly with the Securities and Exchange 
     Commission, determines, by rule or order and consistent with 
     the purposes of the Over-the-Counter Swaps Markets 
     Transparency and Accountability Act of 2010, should be 
     excluded from the definition of swap.
       ``(47) Non-security-based swap data repository.--The term 
     `non-security-based swap data repository' means any person 
     that collects, calculates, prepares, or maintains information 
     or records with respect to transactions or positions in, or 
     the terms and conditions of, non-security-based swaps entered 
     into by third parties.
       ``(48) Non-security-based swap execution facility.--The 
     term `non-security-based swap execution facility' means a 
     facility in which multiple participants have the ability to 
     execute or trade non-security-based swaps by accepting bids 
     and offers made by other participants that are open to 
     multiple participants in the facility or system, or 
     confirmation facility, that--
       ``(A) facilitates the execution of non-security-based swaps 
     between persons; and
       ``(B) is not a designated contract market.''; and
       (20) in paragraph (49) (as redesignated by paragraph (1)), 
     in subparagraph (A)(i), by striking ``partipants'' and 
     inserting ``participants''.
       (b) Conforming Amendments.--
       (1) Section 2(c)(2)(B)(i)(II) of the Commodity Exchange Act 
     (7 U.S.C. 2(c)(2)(B)(i)(II)) is amended--
       (A) an item (cc)--
       (i) in subitem (AA), by striking ``section 1a(20)'' and 
     inserting ``section 1a''; and
       (ii) in subitem (BB), by striking ``section 1a(20)'' and 
     inserting ``section 1a''; and
       (B) in item (dd), by striking ``section 1a(12)(A)(ii)'' and 
     inserting ``section 1a(17)(A)(ii)''.
       (2) Section 4m(3) of the Commodity Exchange Act (7 U.S.C. 
     6m(3)) is amended by striking ``section 1a(6)'' and inserting 
     ``section 1a''.
       (3) Section 4q(a)(1) of the Commodity Exchange Act (7 
     U.S.C. 6o-1(a)(1)) is amended by striking ``section 1a(4)'' 
     and inserting ``section 1a(9)''.
       (4) Section 5(e)(1) of the Commodity Exchange Act (7 U.S.C. 
     7(e)(1)) is amended by striking ``section 1a(4)'' and 
     inserting ``section 1a(9)''.
       (5) Section 5a(b)(2)(F) of the Commodity Exchange Act (7 
     U.S.C. 7a(b)(2)(F)) is amended by striking ``section 1a(4)'' 
     and inserting ``section 1a(9)''.
       (6) Section 5b(a) of the Commodity Exchange Act (7 U.S.C. 
     7a-1(a)) is amended, in the matter preceding paragraph (1), 
     by striking ``section 1a(9)'' and inserting ``section 1a''.
       (7) Section 5c(c)(2)(B) of the Commodity Exchange Act (7 
     U.S.C. 7a-2(c)(2)(B)) is amended by striking ``section 
     1a(4)'' and inserting ``section 1a(9)''.
       (8) Section 6(g)(5)(B)(i) of the Securities Exchange Act of 
     1934 (15 U.S.C. 78f(g)(5)(B)(i)) is amended--
       (A) in subclause (I), by striking ``section 1a(12)(B)(ii)'' 
     and inserting ``section 1a(17)(B)(ii)''; and

[[Page S3177]]

       (B) in subclause (II), by striking ``section 1a(12)'' and 
     inserting ``section 1a(17)''.
       (9) The Legal Certainty for Bank Products Act of 2000 (7 
     U.S.C. 27 et seq.) is amended--
       (A) in section 402--
       (i) in subsection (a)(7), by striking ``section 1a(20)'' 
     and inserting ``section 1a'';
       (ii) in subsection (b)(2), by striking ``section 1a(12)'' 
     and inserting ``section 1a'';
       (iii) in subsection (c), by striking ``section 1a(4)'' and 
     inserting ``section 1a''; and
       (iv) in subsection (d)--

       (I) in the matter preceding paragraph (1), by striking 
     ``section 1a(4)'' and inserting ``section 1a(9)'';
       (II) in paragraph (1)--

       (aa) in subparagraph (A), by striking ``section 1a(12)'' 
     and inserting ``section 1a''; and
       (bb) in subparagraph (B), by striking ``section 1a(33)'' 
     and inserting ``section 1a'';

       (III) in paragraph (2)--

       (aa) in subparagraph (A), by striking ``section 1a(10)'' 
     and inserting ``section 1a'';
       (bb) in subparagraph (B), by striking ``section 
     1a(12)(B)(ii)'' and inserting ``section 1a(18)(B)(ii)'';
       (cc) in subparagraph (C), by striking ``section 1a(12)'' 
     and inserting ``section 1a(17)''; and
       (dd) in subparagraph (D), by striking ``section 1a(13)'' 
     and inserting ``section 1a''; and
       (B) in section 404(1) by striking ``section 1a(4)'' and 
     inserting ``section 1a''.
       (c) Legal Certainty for Certain Transactions in Exempt 
     Commodities.--
       (1) Petition.--Not later than 60 days after the date of 
     enactment of this Act, a person may submit to the Commodity 
     Futures Trading Commission a petition to remain subject to 
     section 2(h) of the Commodity Exchange Act (7 U.S.C. 2(h)) 
     (as in effect on the day before the date of enactment of this 
     Act).
       (2) Temporary allowance to operate under section 2(h).--The 
     Commodity Futures Trading Commission--
       (A) shall consider any petition submitted under subsection 
     (a) in a prompt manner; and
       (B) may allow a person to continue operating subject to 
     section 2(h) of the Commodity Exchange Act (7 U.S.C. 2(h)) 
     (as in effect on the day before the date of enactment of this 
     Act) for not longer than a 1-year period.
       (d) Agricultural Swaps.--
       (1) In general.--Except as provided in paragraph (2), no 
     person shall offer to enter into, or confirm the execution 
     of, any swap in an agricultural commodity (as defined by the 
     Commodity Futures Trading Commission).
       (2) Exception.--Notwithstanding paragraph (1), a person may 
     offer to enter into, enter into, or confirm the execution of, 
     any swap in an agricultural commodity pursuant to section 
     4(c) of the Commodity Exchange Act (7 U.S.C. 6(c)) or any 
     rule, regulation, or order issued thereunder (including any 
     rule, regulation, or order in effect as of the date of 
     enactment of this Act) by the Commodity Futures Trading 
     Commission to allow swaps under such terms and conditions as 
     the Commission shall prescribe.

     SEC. 722. JURISDICTION.

       (a) Exclusive Jurisdiction.--Section 2(a)(1)(A) of the 
     Commodity Exchange Act (7 U.S.C. 2(a)(1)(A)) is amended in 
     the first sentence--
       (1) by inserting ``the Over-the-Counter Swaps Markets 
     Transparency and Accountability Act of 2010 (including an 
     amendment made by that Act) and'' after ``otherwise provided 
     in'';
       (2) by striking ``(c) through (i) of this section'' and 
     inserting ``(c) and (f)'';
       (3) by striking ``contracts of sale'' and inserting ``non-
     security-based swaps or contracts of sale''; and
       (4) by striking ``or derivatives transaction execution 
     facility registered pursuant to section 5 or 5a'' and 
     inserting ``pursuant to section 5''.
       (b) Regulation of Swaps Under Federal and State Law.--
     Section 12 of the Commodity Exchange Act (7 U.S.C. 16) is 
     amended by adding at the end the following:
       ``(h) Regulation of Swaps as Insurance Under State Law.--A 
     swap--
       ``(1) shall not be considered to be insurance; and
       ``(2) may not be regulated as an insurance contract under 
     the law of any State.''.
       (c) Agreements, Contracts, and Transactions Traded on an 
     Organized Exchange.--Section 2(c)(2)(A) of the Commodity 
     Exchange Act (7 U.S.C. 2(c)(2)(A)) is amended--
       (1) in clause (i), by striking ``or'' at the end;
       (2) by redesignating clause (ii) as clause (iii); and
       (3) by inserting after clause (i) the following:
       ``(ii) a non-security-based swap; or''.
       (d) Applicability.--Section 2 of the Commodity Exchange Act 
     (7 U.S.C. 2) (as amended by section 723(a)(3)) is amended by 
     adding at the end the following:
       ``(i) Applicability.--The swap-related provisions of this 
     Act that were enacted by the Over-the-Counter Swaps Markets 
     Transparency and Accountability Act of 2010 (including any 
     rule prescribed or regulation promulgated under that Act), 
     shall not apply to activities outside the United States 
     unless those activities--
       ``(1) have a direct and significant connection with 
     activities in, or effect on, commerce of the United States; 
     or
       ``(2) contravene such rules or regulations as the 
     Commission may prescribe or promulgate as are necessary or 
     appropriate to prevent the evasion of any provision of this 
     Act that was enacted by the Over-the-Counter Swaps Markets 
     Transparency and Accountability Act of 2010.''.

     SEC. 723. CLEARING.

       (a) Clearing Requirement.--
       (1) In general.--Section 2 of the Commodity Exchange Act (7 
     U.S.C. 2) is amended--
       (A) by striking subsections (d), (e), (g), and (h); and
       (B) by redesignating subsection (i) as subsection (g).
       (2) Swaps; limitation on participation.--Section 2 of the 
     Commodity Exchange Act (7 U.S.C. 2) (as amended by paragraph 
     (1)) is amended by inserting after subsection (c) the 
     following:
       ``(d) Swaps.--Nothing in this Act (other than subparagraphs 
     (A) and (B) of subsection (a)(1), subsections (f) and (g), 
     sections 1a, 2(e), 2(h), 4(c), 4a, 4b, and 4b-1, subsections 
     (a), (b), and (g) of section 4c, sections 4d, 4e, 4f, 4g, 4h, 
     4i, 4j, 4k, 4l, 4m, 4n, 4o, 4p, 4r, 4s, 4t, 5, 5b, 5c, 5e, 
     and 5h, subsections (c) and (d) of section 6, sections 6c, 
     6d, 8, 8a, and 9, subsections (e)(2) and (f) of section 12, 
     subsections (a) and (b) of section 13, sections 17, 20, 21, 
     and 22(a)(4), and any other provision of this Act that is 
     applicable to registered entities and Commission registrants) 
     governs or applies to a swap.
       ``(e) Limitation on Participation.--It shall be unlawful 
     for any person, other than an eligible contract participant, 
     to enter into a non-security-based swap unless the non-
     security-based swap is entered into on, or subject to the 
     rules of, a board of trade designated as a contract market 
     under section 5.''.
       (3) Mandatory clearing of non-security-based swaps.--
     Section 2 of the Commodity Exchange Act (7 U.S.C. 2) is 
     amended by inserting after subsection (g) (as redesignated by 
     paragraph (1)(B)) the following:
       ``(h) Clearing Requirement.--
       ``(1) Swaps subject to mandatory clearing requirement.--
       ``(A) In general.--In accordance with subparagraph (B), the 
     Commission shall, jointly with the Securities and Exchange 
     Commission and the Federal Reserve Board of Governors, adopt 
     rules to establish criteria for determining that a swap or 
     any group, category, type, or class of swap is required to be 
     cleared.
       ``(B) Factors.--In carrying out subparagraph (A), the 
     following factors shall be considered:
       ``(i) Whether 1 or more derivatives clearing organizations 
     or clearing agencies accepts the swap or group, category, 
     type, or class of swap for clearing.
       ``(ii) Whether the swap or group, category, type, or class 
     of swap is traded pursuant to standard documentation and 
     terms.
       ``(iii) The liquidity of the swap or group, category, type, 
     or class of swap and its underlying commodity, security, 
     security of a reference entity, or group or index thereof.
       ``(iv) The ability to value the swap group, category, type, 
     or class of swap and its underlying commodity, security, 
     security of a reference entity, or group or index thereof 
     consistent with an accepted pricing methodology, including 
     the availability of intraday prices.
       ``(v) The size of the market for the swap or group, 
     category, type, or class of swap and the available capacity, 
     operational expertise, and resources of the derivatives 
     clearing organization or clearing agency that accepts it for 
     clearing.
       ``(vi) Whether a clearing mandate would mitigate risk to 
     the financial system or whether it would unduly concentrate 
     risk in a clearing participant, derivatives clearing 
     organization, or clearing agency in a manner that could 
     threaten the solvency of that clearing participant, the 
     derivatives clearing organization, or the clearing agency.
       ``(vii) Such other factors as the Commission, the 
     Securities and Exchange Commission, and the Federal Reserve 
     Board of Governors jointly may determine are relevant.
       ``(C) Non-security-based swaps subject to clearing 
     requirement.--The Commission--
       ``(i) shall review each non-security-based swap, or any 
     group, category, type, or class of non-security-based swap 
     that is currently listed for clearing and those which a 
     derivatives clearing organization notifies the Commission 
     that the derivatives clearing organization plans to list for 
     clearing after the date of enactment of this subsection;
       ``(ii) may require, pursuant to the rules adopted under 
     clause (i) and through notice-and-comment rulemaking, that a 
     particular non-security-based swap, group, category, type, or 
     class of non-security-based swap must be cleared if--

       ``(I) both counterparties are swap participants;
       ``(II) the transaction was entered into after the later of 
     the date of publication of the rules adopted under 
     subparagraph (A) in the Federal Register or the effective 
     date of the requirement; and
       ``(III) one counterparty directly or indirectly controls, 
     is controlled by, or is under common control with the other 
     counterparty, provided, however, that the Commission, jointly 
     with the Financial Stability Oversight Council, may 
     determine, by rule or order, that transactions between 
     certain parties under common control are subject to any 
     requirement to clear under clause (ii); and

[[Page S3178]]

       ``(iii) shall rely on economic analysis provided by 
     economists of the Commission in making any determination 
     under clause (ii), which economic analysis may refer to any 
     peer-reviewed or other relevant literature conducted by 
     independent researchers.
       ``(D) Effect.--
       ``(i) In general.--Nothing in this paragraph affects the 
     ability of a derivatives clearing organization to list for 
     permissive clearing any swap, or group, category, type, or 
     class of swap.
       ``(ii) Prohibition.--The Commission shall not compel a 
     derivatives clearing organization to list a swap, group, 
     category, type, or class of swap for clearing if the 
     derivatives clearing organization determines that the swap, 
     group, category, type, or class of swap would adversely 
     impact its business operations, impair the financial 
     integrity of the derivatives clearing organization, or pose a 
     threat to the financial stability of the United States.
       ``(E) Prevention of evasion.--The Commission may prescribe 
     rules, or issue interpretations of such rules, as necessary 
     to prevent evasions of any requirement to clear under 
     subparagraph (C). In issuing such rules or interpretations, 
     the Commission shall consider--
       ``(i) the extent to which the terms of the non-security-
     based swap, group, category, type, or class of non-security-
     based swap are similar to the terms of other non-security-
     based swaps, groups, categories, types, or classes of non-
     security-based swap that are required to be cleared by swap 
     participants under subparagraph (C); and
       ``(ii) whether there is an economic purpose for any 
     differences in the terms of the non-security-based swap or 
     group, category, type, or class of non-security-based swap 
     that are required to be cleared by swap participants under 
     subparagraph (C).
       ``(F) Elimination of requirement to clear.--The Commission 
     may, pursuant to the rules adopted under subparagraph (A) and 
     through notice-and-comment rulemaking, rescind a requirement 
     imposed under subparagraph (C) with respect to a non-
     security-based swap, group, category, type, or class of non-
     security-based swap.
       ``(G) Petition for rulemaking.--Any person may file a 
     petition, pursuant to the rules of practice of the 
     Commission, requesting that the Commission use its authority 
     under subparagraph (C) to require swap participants to clear 
     a particular non-security-based swap, group, category, type, 
     or class of non-security-based swap or to use its authority 
     under subparagraph (F) to rescind a requirement for non-
     security-based swap participants to clear a particular non-
     security-based swap, group, category, type, or class of non-
     security-based swap.
       ``(H) Option to clear for counterparties that are not swap 
     participants.--Before entering into a non-security-based swap 
     transaction, any counterparty that is not a swap participant 
     may elect to clear a non-security-based swap that is subject 
     to a clearing requirement under subparagraph (C). If such 
     counterparty elects to clear, it shall have the sole right to 
     select the derivatives clearing organization or clearing 
     agency at which the non-security-based swap will be cleared.
       ``(I) Foreign exchange forwards, swaps, and options.--
     Foreign exchange forwards, swaps, and options shall not be 
     subject to a clearing requirement under subparagraph (C) 
     unless the Department of the Treasury and the Board of 
     Governors determine that such a requirement is appropriate 
     after taking into consideration whether there exists an 
     effective settlement system for such foreign exchange 
     forwards, swaps, and options and any other factors that the 
     Department of the Treasury and the Board of Governors deem to 
     be relevant.''.

     SEC. 724. SWAPS; SEGREGATION AND BANKRUPTCY TREATMENT.

       (a) Segregation Requirements for Cleared Swaps.--Section 4d 
     of the Commodity Exchange Act (7 U.S.C. 6d) is amended by 
     adding at the end the following:
       ``(f) Swaps.--
       ``(1) Cleared swaps.--
       ``(A) Segregation required.--A futures commission merchant 
     or a swap participant shall treat and deal with all money, 
     securities, and property of any swap customer received to 
     margin, guarantee, or secure a swap cleared by or through a 
     derivatives clearing organization (including money, 
     securities, or property accruing to the swap customer as the 
     result of such a swap) as belonging to the swap customer.
       ``(B) Commingling prohibited.--Money, securities, and 
     property of a swap customer described in subparagraph (A) 
     shall be separately accounted for and shall not be commingled 
     with the funds of the futures commission merchant or the swap 
     participant or be used to margin, secure, or guarantee any 
     trades or contracts of any swap customer or person other than 
     the person for whom the same are held.
       ``(2) Exceptions.--
       ``(A) Use of funds.--
       ``(i) In general.--Notwithstanding paragraph (1), money, 
     securities, and property of a swap customer of a futures 
     commission merchant or a swap participant described in 
     paragraph (1) may, for convenience, be commingled and 
     deposited in the same 1 or more accounts with any bank or 
     trust company or with a derivatives clearing organization.
       ``(ii) Withdrawal.--Notwithstanding paragraph (1), such 
     share of the money, securities, and property described in 
     clause (i) as in the normal course of business shall be 
     necessary to margin, guarantee, secure, transfer, adjust, or 
     settle a cleared swap with a derivatives clearing 
     organization, or with any member of the derivatives clearing 
     organization, may be withdrawn and applied to such purposes, 
     including the payment of commissions, brokerage, interest, 
     taxes, storage, and other charges, lawfully accruing in 
     connection with the cleared swap.
       ``(B) Commission action.--Notwithstanding paragraph (1), in 
     accordance with such terms and conditions as the Commission 
     may prescribe by rule, regulation, or order, any money, 
     securities, or property of the swap customer of a futures 
     commission merchant or a swap participant described in 
     paragraph (1) may be commingled and deposited as provided in 
     this section with any other money, securities, or property 
     received by the futures commission merchant or swap 
     participant and required by the Commission to be separately 
     accounted for and treated and dealt with as belonging to the 
     swap customer of the futures commission merchant.
       ``(3) Permitted investments.--Money described in paragraph 
     (1) may be invested in obligations of the United States or in 
     any other investment that has minimal credit, market, and 
     liquidity risks that the Commission may by rule or regulation 
     prescribe, and such investments shall be made in accordance 
     with such rules and regulations and subject to such 
     conditions as the Commission may prescribe.
       ``(4) Commodity contract.--A non-security-based swap 
     cleared by or through a derivatives clearing organization 
     shall be considered to be a commodity contract as such term 
     is defined in section 761 of title 11, United States Code, 
     with regard to all money, securities, and property of any 
     swap customer received by a futures commission merchant, a 
     swap participant, or a derivatives clearing organization to 
     margin, guarantee, or secure the non-security-based swap 
     (including money, securities, or property accruing to the 
     customer as the result of the swap).
       ``(5) Prohibition.--It shall be unlawful for any person, 
     including any derivatives clearing organization and any 
     depository, that has received any money, securities, or 
     property for deposit in a separate account or accounts as 
     provided in paragraph (1) to hold, dispose of, or use any 
     such money, securities, or property as belonging to the 
     depositing futures commission merchant, a swap participant or 
     any person other than the swap customer of the futures 
     commission merchant or swap participant.''.
       (b) Bankruptcy Treatment of Cleared Non-security-based 
     Swaps.--Section 761 of title 11, United States Code, is 
     amended--
       (1) in paragraph (4), by striking subparagraph (F) and 
     inserting the following:
       ``(F)(i) any other contract, option, agreement, or 
     transaction that is similar to a contract, option, agreement, 
     or transaction referred to in this paragraph; and
       ``(ii) with respect to a futures commission merchant, a 
     swap participant, or a clearing organization, any other 
     contract, option, agreement, or transaction, in each case, 
     that is cleared by a clearing organization''; and
       (2) in paragraph (9)(A)(i), by striking ``the commodity 
     futures account'' and inserting ``a commodity contract 
     account''.
       (c) Segregation Requirements for Uncleared Non-security-
     based Swaps.--Section 4s of the Commodity Exchange Act (as 
     added by section 729) is amended by adding at the end the 
     following:
       ``(l) Segregation Requirements for Initial Margin.--
       ``(1) Segregation of initial margin.--
       ``(A) Notification of right to segregate.--A swap 
     participant shall notify its counterparty before entering 
     into a non-security-based swap transaction of the 
     counterparty's right to require segregation of the funds or 
     other property supplied as initial margin for the purpose of 
     margining, guaranteeing, or securing the obligations of the 
     counterparty.
       ``(B) Segregation and maintenance of funds.--At the 
     request, made before entering into a non-security-based swap 
     transaction, of a counterparty that provides funds or other 
     property as initial margin to a swap participant for the 
     purpose of margining, guaranteeing, or securing the 
     obligations of the counterparty, the swap participant shall--
       ``(i) segregate the funds or other property for the benefit 
     of the counterparty; and
       ``(ii) in accordance with such rules and regulations as the 
     Commission may promulgate jointly with the Securities and 
     Exchange Commission, maintain the funds or other property in 
     a segregated account separate from the assets and other 
     interests of the swap participant.
       ``(C) Notification of excess variation margin.--Pursuant to 
     rules or regulations adopted by the Commission, a swap 
     participant who received funds or other property shall notify 
     any counterparty who provided such funds or other property if 
     the swap participant is holding excess net variation margin 
     from that counterparty.
       ``(2) Applicability.--The requirements described in 
     paragraph (1) shall--
       ``(A) apply only to a non-security-based swap between a 
     counterparty and a swap participant that is not submitted for 
     clearing to a derivatives clearing organization; and
       ``(B)(i) not apply to variation margin payments; and
       ``(ii) not preclude any commercial arrangement regarding--
       ``(I) the investment of segregated funds or other property 
     that may only be invested in

[[Page S3179]]

     such investments as the Commission may permit by rule or 
     regulation; and
       ``(II) the related allocation of gains and losses resulting 
     from any investment of the segregated funds or other 
     property.
       ``(3) Use of independent third-party custodians.--The 
     segregated account described in paragraph (1), if requested 
     by the counterparty, may be--
       ``(A) carried by an independent third-party custodian; and
       ``(B) designated as a segregated account for and on behalf 
     of the counterparty.
       ``(4) Reporting requirement.--If the counterparty does not 
     choose to require segregation of the funds or other property 
     supplied as initial margin for the purpose of margining, 
     guaranteeing, or securing the obligations of the 
     counterparty, the swap participant shall report to the 
     counterparty of the swap participant on a quarterly basis 
     that the back office procedures of the swap participant 
     relating to initial margin and collateral requirements are in 
     compliance with the agreement of the counterparties.''.

     SEC. 725. DERIVATIVES CLEARING ORGANIZATIONS.

       (a) Registration Requirement.--Section 5b of the Commodity 
     Exchange Act (7 U.S.C. 7a-1) is amended by striking 
     subsections (a) and (b) and inserting the following:
       ``(a) Registration Requirement.--
       ``(1) In general.--Except as provided in paragraph (2), it 
     shall be unlawful for a derivatives clearing organization, 
     directly or indirectly, to make use of the mails or any means 
     or instrumentality of interstate commerce to perform the 
     functions of a derivatives clearing organization with respect 
     to--
       ``(A) a contract of sale of a commodity for future delivery 
     (or an option on the contract of sale) or option on a 
     commodity, in each case, unless the contract or option is--
       ``(i) excluded from this Act by subsection (a)(1)(C)(i), 
     (c), or (f) of section 2; or
       ``(ii) a security futures product cleared by a clearing 
     agency registered with the Securities and Exchange Commission 
     under the Securities Exchange Act of 1934 (15 U.S.C. 78a et 
     seq.); or
       ``(B) a non-security-based swap.
       ``(2) Exception.--Paragraph (1) shall not apply to a 
     derivatives clearing organization that is registered with the 
     Commission.
       ``(b) Voluntary Registration.--A person that clears 1 or 
     more agreements, contracts, or transactions that are not 
     required to be cleared under this Act may register with the 
     Commission as a derivatives clearing organization.''.
       (b) Registration for Banks and Clearing Agencies; 
     Exemptions; Annual Reports.--Section 5b of the Commodity 
     Exchange Act (7 U.S.C. 7a-1) is amended by adding at the end 
     the following:
       ``(g) Required Registration for Banks and Clearing 
     Agencies.--A person that is required to be registered as a 
     derivatives clearing organization under this section shall 
     register with the Commission regardless of whether the person 
     is also licensed as a bank or a clearing agency registered 
     with the Securities and Exchange Commission under the 
     Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.).
       ``(h) Existing Banks and Clearing Agencies.--
       ``(1) In general.--A bank or clearing agency registered 
     with the Securities and Exchange Commission under the 
     Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) that 
     is required to be registered as a derivatives clearing 
     organization under this section is deemed to be registered 
     under this section to the extent that, before date of 
     enactment of this subsection--
       ``(A) the bank cleared swaps as a multilateral clearing 
     organization; or
       ``(B) the clearing agency cleared swaps.
       ``(2) Conversion of bank.--A bank to which this paragraph 
     applies may, by the vote of the shareholders owning not less 
     than 51 percent of the voting interests of the bank, be 
     converted into a State corporation, partnership, limited 
     liability company, or similar legal form pursuant to a plan 
     of conversion, if the conversion is not in contravention of 
     applicable State law.''.
       (c) Core Principles for Derivatives Clearing 
     Organizations.--Section 5b(c) of the Commodity Exchange Act 
     (7 U.S.C. 7a-1(c)) is amended by striking paragraph (2) and 
     inserting the following:
       ``(2) Core principles for derivatives clearing 
     organizations.--
       ``(A) Compliance.--
       ``(i) In general.--To be registered and to maintain 
     registration as a derivatives clearing organization, a 
     derivatives clearing organization shall comply with each core 
     principle described in this paragraph and any requirement 
     that the Commission may impose by rule or regulation pursuant 
     to section 8a(5).
       ``(ii) Discretion of derivatives clearing organization.--
     Subject to any rule or regulation prescribed by the 
     Commission, a derivatives clearing organization shall have 
     reasonable discretion in establishing the manner by which the 
     derivatives clearing organization complies with each core 
     principle described in this paragraph.
       ``(B) Financial resources.--
       ``(i) In general.--Each derivatives clearing organization 
     shall have adequate financial, operational, and managerial 
     resources, as determined by the Commission, to discharge each 
     responsibility of the derivatives clearing organization.
       ``(ii) Minimum amount of financial resources.--Each 
     derivatives clearing organization shall possess financial 
     resources that, at a minimum, exceed the total amount that 
     would--

       ``(I) enable the derivatives clearing organization to meet 
     each financial obligation of the derivatives clearing 
     organization to each member and participant of the 
     derivatives clearing organization; and
       ``(II) enable the derivatives clearing organization to 
     cover the operating costs of the derivatives clearing 
     organization for a period of 1 year (as calculated on a 
     rolling basis).

       ``(C) Participant and product eligibility.--
       ``(i) In general.--Each derivatives clearing organization 
     shall establish--

       ``(I) appropriate admission and continuing eligibility 
     standards (including sufficient financial resources and 
     operational capacity to meet obligations arising from 
     participation in the derivatives clearing organization) for 
     members of, and participants in, the derivatives clearing 
     organization; and
       ``(II) appropriate standards for determining the 
     eligibility of agreements, contracts, and transactions 
     submitted to the derivatives clearing organization for 
     clearing.

       ``(ii) Required procedures.--Each derivatives clearing 
     organization shall establish and implement procedures to 
     verify, on an ongoing basis, the compliance of each 
     participation and membership requirement of the derivatives 
     clearing organization.
       ``(iii) Requirements.--The participation and membership 
     requirements of each derivatives clearing organization 
     shall--

       ``(I) be objective;
       ``(II) be publicly disclosed; and
       ``(III) permit fair and open access.

       ``(iv) Offsetting economically equivalent positions.--The 
     rules of a registered derivatives clearing organization shall 
     prescribe that all swaps with the same terms and conditions 
     are economically equivalent and may be offset with each other 
     within the derivatives clearing organization.
       ``(D) Risk management.--
       ``(i) In general.--Each derivatives clearing organization 
     shall ensure that the derivatives clearing organization 
     possesses the ability to manage the risks associated with 
     discharging the responsibilities of the derivatives clearing 
     organization through the use of appropriate tools and 
     procedures.
       ``(ii) Measurement of credit exposure.--Each derivatives 
     clearing organization shall--

       ``(I) not less than once during each business day of the 
     derivatives clearing organization, measure the credit 
     exposures of the derivatives clearing organization to each 
     member and participant of the derivatives clearing 
     organization; and
       ``(II) monitor each exposure described in subclause (I) 
     periodically during the business day of the derivatives 
     clearing organization.

       ``(iii) Limitation of exposure to potential losses from 
     defaults.--Each derivatives clearing organization, through 
     margin requirements and other risk control mechanisms, shall 
     limit the exposure of the derivatives clearing organization 
     to potential losses from defaults by members and participants 
     of the derivatives clearing organization to ensure that--

       ``(I) the operations of the derivatives clearing 
     organization would not be disrupted; and
       ``(II) nondefaulting members or participants would not be 
     exposed to losses that nondefaulting members or participants 
     cannot anticipate or control.

       ``(iv) Margin requirements.--The margin required from each 
     member and participant of a derivatives clearing organization 
     shall be sufficient to cover potential exposures in normal 
     market conditions.
       ``(v) Requirements regarding models and parameters.--Each 
     model and parameter used in setting margin requirements under 
     clause (iv) shall be--

       ``(I) risk-based; and
       ``(II) reviewed on a regular basis.

       ``(E) Settlement procedures.--Each derivatives clearing 
     organization shall--
       ``(i) complete money settlements on a timely basis (but not 
     less frequently than once each business day);
       ``(ii) employ money settlement arrangements to eliminate or 
     strictly limit the exposure of the derivatives clearing 
     organization to settlement bank risks (including credit and 
     liquidity risks from the use of banks to effect money 
     settlements);
       ``(iii) ensure that money settlements are final when 
     effected;
       ``(iv) maintain an accurate record of the flow of funds 
     associated with each money settlement;
       ``(v) possess the ability to comply with each term and 
     condition of any permitted netting or offset arrangement with 
     any other clearing organization;
       ``(vi) regarding physical settlements, establish rules that 
     clearly state each obligation of the derivatives clearing 
     organization with respect to physical deliveries; and
       ``(vii) ensure that each risk arising from an obligation 
     described in clause (vi) is identified and managed.
       ``(F) Treatment of funds.--
       ``(i) Required standards and procedures.--Each derivatives 
     clearing organization shall establish standards and 
     procedures that are designed to protect and ensure the safety 
     of member and participant funds and assets.
       ``(ii) Holding of funds and assets.--Each derivatives 
     clearing organization shall hold member and participant funds 
     and assets in a manner by which to minimize the risk of

[[Page S3180]]

     loss or of delay in the access by the derivatives clearing 
     organization to the assets and funds.
       ``(iii) Permissible investments.--Funds and assets invested 
     by a derivatives clearing organization shall be held in 
     instruments with minimal credit, market, and liquidity risks.
       ``(G) Default rules and procedures.--
       ``(i) In general.--Each derivatives clearing organization 
     shall have rules and procedures designed to allow for the 
     efficient, fair, and safe management of events during which 
     members or participants--

       ``(I) become insolvent; or
       ``(II) otherwise default on the obligations of the members 
     or participants to the derivatives clearing organization.

       ``(ii) Default procedures.--Each derivatives clearing 
     organization shall--

       ``(I) clearly state the default procedures of the 
     derivatives clearing organization;
       ``(II) make publicly available the default rules of the 
     derivatives clearing organization; and
       ``(III) ensure that the derivatives clearing organization 
     may take timely action--

       ``(aa) to contain losses and liquidity pressures; and
       ``(bb) to continue meeting each obligation of the 
     derivatives clearing organization.
       ``(H) Rule enforcement.--Each derivatives clearing 
     organization shall--
       ``(i) maintain adequate arrangements and resources for--

       ``(I) the effective monitoring and enforcement of 
     compliance with the rules of the derivatives clearing 
     organization; and
       ``(II) the resolution of disputes;

       ``(ii) have the authority and ability to discipline, limit, 
     suspend, or terminate the activities of a member or 
     participant due to a violation by the member or participant 
     of any rule of the derivatives clearing organization; and
       ``(iii) report to the Commission regarding rule enforcement 
     activities and sanctions imposed against members and 
     participants as provided in clause (ii).
       ``(I) System safeguards.--Each derivatives clearing 
     organization shall--
       ``(i) establish and maintain a program of risk analysis and 
     oversight to identify and minimize sources of operational 
     risk through the development of appropriate controls and 
     procedures, and automated systems, that are reliable, secure, 
     and have adequate scalable capacity;
       ``(ii) establish and maintain emergency procedures, backup 
     facilities, and a plan for disaster recovery that allows 
     for--

       ``(I) the timely recovery and resumption of operations of 
     the derivatives clearing organization; and
       ``(II) the fulfillment of each obligation and 
     responsibility of the derivatives clearing organization; and

       ``(iii) periodically conduct tests to verify that the 
     backup resources of the derivatives clearing organization are 
     sufficient to ensure daily processing, clearing, and 
     settlement.
       ``(J) Reporting.--Each derivatives clearing organization 
     shall provide to the Commission all information that the 
     Commission determines to be necessary to conduct oversight of 
     the derivatives clearing organization.
       ``(K) Recordkeeping.--Each derivatives clearing 
     organization shall maintain records of all activities related 
     to the business of the derivatives clearing organization as a 
     derivatives clearing organization--
       ``(i) in a form and manner that is acceptable to the 
     Commission; and
       ``(ii) for a period of not less than 5 years.
       ``(L) Public information.--
       ``(i) In general.--Each derivatives clearing organization 
     shall provide to market participants sufficient information 
     to enable the market participants to identify and evaluate 
     accurately the risks and costs associated with using the 
     services of the derivatives clearing organization.
       ``(ii) Availability of information.--Each derivatives 
     clearing organization shall make information concerning the 
     rules and operating procedures governing the clearing and 
     settlement systems of the derivatives clearing organization 
     available to market participants.
       ``(iii) Public disclosure.--Each derivatives clearing 
     organization shall disclose publicly and to the Commission 
     information concerning--

       ``(I) the terms and conditions of each contract, agreement, 
     and other transaction cleared and settled by the derivatives 
     clearing organization;
       ``(II) each clearing and other fee that the derivatives 
     clearing organization charges the members and participants of 
     the derivatives clearing organization;
       ``(III) the margin-setting methodology, and the size and 
     composition, of the financial resource package of the 
     derivatives clearing organization;
       ``(IV) daily settlement prices, volume, and open interest 
     for each contract settled or cleared by the derivatives 
     clearing organization; and
       ``(V) any other matter relevant to participation in the 
     settlement and clearing activities of the derivatives 
     clearing organization.

       ``(M) Information-sharing.--Each derivatives clearing 
     organization shall--
       ``(i) enter into, and abide by the terms of, each 
     appropriate and applicable domestic and international 
     information-sharing agreement; and
       ``(ii) use relevant information obtained from each 
     agreement described in clause (i) in carrying out the risk 
     management program of the derivatives clearing organization.
       ``(N) Antitrust considerations.--Unless appropriate to 
     achieve the purposes of this Act, a derivatives clearing 
     organization may not--
       ``(i) adopt any rule or take any action that results in any 
     unreasonable restraint of trade; or
       ``(ii) impose any material anticompetitive burden.
       ``(O) Governance fitness standards.--
       ``(i) Governance arrangements.--Each derivatives clearing 
     organization shall establish governance arrangements that are 
     transparent--

       ``(I) to fulfill public interest requirements; and
       ``(II) to support the objectives of owners and 
     participants.

       ``(ii) Fitness standards.--Each derivatives clearing 
     organization shall establish and enforce appropriate fitness 
     standards for--

       ``(I) directors;
       ``(II) members of any disciplinary committee;
       ``(III) members of the derivatives clearing organization;
       ``(IV) any other individual or entity with direct access to 
     the settlement or clearing activities of the derivatives 
     clearing organization; and
       ``(V) any party affiliated with any individual or entity 
     described in this clause.

       ``(P) Conflicts of interest.--Each derivatives clearing 
     organization shall--
       ``(i) establish and enforce rules to minimize conflicts of 
     interest in the decision-making process of the derivatives 
     clearing organization; and
       ``(ii) establish a process for resolving conflicts of 
     interest described in clause (i).
       ``(Q) Composition of governing boards.--Each derivatives 
     clearing organization shall ensure that the composition of 
     the governing board or committee of the derivatives clearing 
     organization includes market participants.
       ``(R) Legal risk.--Each derivatives clearing organization 
     shall have a well-founded, transparent, and enforceable legal 
     framework for each aspect of the activities of the 
     derivatives clearing organization.''.
       (d) Reporting Requirements.--Section 5b of the Commodity 
     Exchange Act (7 U.S.C. 7a-1) (as amended by subsection (b)) 
     is amended by adding at the end the following:
       ``(j) Reporting Requirements.--
       ``(1) Duty of derivatives clearing organizations.--Each 
     derivatives clearing organization that clears non-security-
     based swaps shall provide to the Commission all information 
     that is determined by the Commission to be necessary to 
     perform each responsibility of the Commission under this Act.
       ``(2) Data collection and maintenance requirements.--The 
     Commission shall adopt data collection and maintenance 
     requirements for non-security-based swaps cleared by 
     derivatives clearing organizations that are comparable to the 
     corresponding requirements for non-security-based swaps data 
     reported to non-security-based swap data repositories.
       ``(3) Information sharing.--The Commission shall require 
     derivatives clearing organizations to provide information 
     collected under paragraph (2) to any of the following 
     regulatory authorities that requires it--
       ``(A) the Board;
       ``(B) the Securities and Exchange Commission;
       ``(C) each appropriate prudential regulator;
       ``(D) the Financial Stability Oversight Council;
       ``(E) the Department of Justice; and
       ``(F) any other person that the Commission determines to be 
     appropriate, including--
       ``(i) foreign financial supervisors (including foreign 
     futures authorities);
       ``(ii) foreign central banks; and
       ``(iii) foreign ministries.
       ``(4) Public information.--Each derivatives clearing 
     organization that clears non-security-based swaps shall 
     provide to the Commission (including any designee of the 
     Commission) information under paragraph (2) in such form and 
     at such frequency as is required by the Commission to comply 
     with the public reporting requirements contained in section 
     2(a)(13).''.
       (e) Public Disclosure.--Section 8(e) of the Commodity 
     Exchange Act (7 U.S.C. 12(e)) is amended in the last 
     sentence--
       (1) by inserting ``, central bank and ministries,'' after 
     ``department'' each place it appears; and
       (2) by striking ``. is a party.'' and inserting ``, is a 
     party.''.
       (f) Legal Certainty for Identified Banking Products.--
       (1) Repeals.--The Legal Certainty for Bank Products Act of 
     2000 (7 U.S.C. 27 et seq.) is amended--
       (A) by striking sections 404 and 407 (7 U.S.C. 27b, 27e);
       (B) in section 402 (7 U.S.C. 27), by striking subsection 
     (d); and
       (C) in section 408 (7 U.S.C. 27f)--
       (i) in subsection (c)--

       (I) by striking ``in the case'' and all that follows 
     through ``a hybrid'' and inserting ``in the case of a 
     hybrid'';
       (II) by striking ``; or'' and inserting a period; and
       (III) by striking paragraph (2);

       (ii) by striking subsection (b); and
       (iii) by redesignating subsection (c) as subsection (b).

[[Page S3181]]

       (2) Legal certainty for bank products act of 2000.--Section 
     403 of the Legal Certainty for Bank Products Act of 2000 (7 
     U.S.C. 27a) is amended to read as follows:

     SEC. 726. TRANSPARENCY OF SWAP TRANSACTION DATA.

       (a) Purposes.--The Commodity Futures Trading Commission is 
     directed, consistent with the purposes of this title, to use 
     its authority under this title to facilitate the prompt and 
     accurate collection, calculation, processing or preparation, 
     and public dissemination of information on transactions and 
     positions in non-security-based swaps.
       (b) Transparency of Non-Security-Based Swap Transaction 
     Data.--The Commodity Exchange Act is amended by inserting 
     after section 4q (7 U.S.C. 6o-1) the following:

     ``SEC. 4R. REPORTING AND RECORDKEEPING FOR NON-SECURITY-BASED 
                   SWAPS.

       ``(a) Mandatory Reporting of Non-security-based Swap 
     Transactions.--
       ``(1) In general.--Any person that enters into or effects a 
     transaction in a non-security-based swap shall report such 
     transaction through a derivatives clearing organization or a 
     non-security-based swap data repository registered with the 
     Commission pursuant to section 21 within the period specified 
     by any rule or regulation adopted by the Commission under 
     this paragraph. If no registered non-security-based swap data 
     repository accepts the non-security-based swap, the person 
     shall report the transaction to the Commission pursuant to 
     the requirements that the Commission may by rule or 
     regulation prescribe. Each transaction report shall disclose 
     whether the transaction is a bona fide hedging swap 
     transaction as defined in section 1a(33B) and any other 
     information that the Commission has, by rule or regulation, 
     prescribed as necessary or appropriate in furtherance of the 
     purposes of this section.
       ``(2) Permissible reporting for a counterparty that is not 
     a swap participant.--A swap participant may report a 
     transaction on behalf of its counterparty to that transaction 
     provided that counterparty is not a swap participant.
       ``(3) Rulemaking required.--Not later than 180 days after 
     the date of enactment of this section, the Commission shall 
     by rule or regulation establish a schedule for the reporting 
     through a derivatives clearing organization or registered 
     non-security-based swap data repository or to the Commission 
     of each non-security-based swap, group, category, type, or 
     class of non-security-based swap entered into--
       ``(A) before the effective date of the Commission's rule or 
     regulation and still outstanding as of such effective date; 
     and
       ``(B) on or after the effective date of the Commission's 
     rule or regulation.
       ``(b) Confidentiality of Information Provided.--No non-
     public information provided to or obtained by the Commission 
     under this section may be disclosed to any other person. 
     Nothing in this subsection shall authorize the Commission to 
     withhold information from Congress, or prevent the Commission 
     from complying with a request for information from any other 
     Federal department or agency or foreign government with which 
     the Commission has an information sharing arrangement that 
     requests the information for purposes within the scope of its 
     jurisdiction, or complying with an order of a court of the 
     United States in an action brought by the United States or 
     the Commission.
       ``(c) Public Dissemination of Certain Information 
     Provided.--
       ``(1) In general.--Notwithstanding subsection (b), the 
     Commission is directed to use its authority under this Act to 
     facilitate the public dissemination of prices and volumes of 
     completed non-security-based swap transactions to provide 
     investors and other market participants with information 
     about recently executed transactions for the purposes of 
     helping them to mark existing swap positions to market, make 
     informed decisions before executing future transactions, and 
     assess the quality of transactions they have executed. For 
     each non-security-based swap, group, category, type, or class 
     of non-security-based swap, the Commission shall determine by 
     rule the extent to which individual or aggregated transaction 
     data must be disseminated and the timeliness of such 
     disseminations.
       ``(2) Reliance on economic analysis.--In making 
     determinations under this subsection, the Commission shall 
     rely on economic analyses provided by the Chief Economist of 
     the Commission and independent researchers that empirically 
     evaluate the effects of increasing price transparency on 
     measures of efficiency, competition, and market quality, 
     including transaction costs and liquidity. To facilitate such 
     empirical analyses, the Commission may design pilot programs 
     that increase price transparency on selected non-security-
     based swaps.
       ``(3) Chief economist report.--Whenever the Commission 
     publishes a release giving notice of a proposed rulemaking 
     under this subsection, and affords interested persons an 
     opportunity to comment on such proposed rulemaking or 
     publishes a release adopting a final rule, such release shall 
     include as a part thereof a report by the Chief Economist of 
     the Commission. Each report shall describe the economic 
     analysis of the expected consequences of the proposed or 
     final Commission action, refer to any peer-reviewed or other 
     literature, including any empirical study undertaken by the 
     staff of the Commission, that is relevant to the analysis 
     contained in the report, and describe the extent to which the 
     conclusions of the report remain subject to uncertainty.
       ``(4) Protection of proprietary information.--In making 
     determinations under this subsection, the Commission shall 
     consider whether public dissemination of individual or 
     aggregate transaction data could result in the dissemination 
     of proprietary information about the swap transactions, 
     positions, trading strategies, or the ability of particular 
     market participants to conduct effective hedging or risk 
     management. The rules that the Commission adopts under this 
     subsection shall include protections to ensure that the 
     public dissemination of swap transaction data does not result 
     in the disclosure of such proprietary information.''.
       ``(5) Registered entities and public reporting.--The 
     Commission may require derivatives clearing organizations and 
     registered non-security-based swap data repositories to 
     publicly disseminate the non-security-based swap transaction 
     and pricing data required to be reported under this 
     paragraph.
       ``(6) Quarterly public reporting of aggregate non-security-
     based swap data.--
       ``(A) In general.--In accordance with subparagraph (B), the 
     Commission shall issue a written report on a quarterly basis 
     to make available to the public information relating to--
       ``(i) the trading and clearing in the major non-security-
     based swap categories; and
       ``(ii) the market participants and developments in new 
     products.
       ``(B) Use; consultation.--In preparing a report under 
     subparagraph (A), the Commission shall--
       ``(i) use any information reported directly to the 
     Commission and information from registered non-security-based 
     swap data repositories and derivatives clearing 
     organizations; and
       ``(ii) consult with the Office of the Comptroller of the 
     Currency, the Bank for International Settlements, and such 
     other regulatory bodies as may be necessary.''.

     SEC. 727. SWAP DATA REPOSITORIES.

       The Commodity Exchange Act is amended by inserting after 
     section 20 (7 U.S.C. 24) the following:

     ``SEC. 21. NON-SECURITY-BASED SWAP DATA REPOSITORIES.

       ``(a) Registration.--
       ``(1) In general.--A non-security-based swap data 
     repository may register by filing with the Commission an 
     application in such form as the Commission, by rule or 
     regulation, shall prescribe containing such information as 
     the Commission, by rule or regulation, may prescribe as 
     necessary or appropriate in furtherance of the purposes of 
     this section.
       ``(2) Inspection and examination.--Each registered non-
     security-based swap data repository shall be subject to 
     inspection and examination by any representative of the 
     Commission.
       ``(3) Information sharing.--The Commission shall require 
     each registered non-security-based swap data repository to 
     provide information with respect to its functions as a non-
     security-based swap data repository to any of the following 
     regulatory authorities that requests it--
       ``(A) the Board;
       ``(B) the Securities and Exchange Commission;
       ``(C) each appropriate prudential regulator;
       ``(D) the Financial Stability Oversight Council;
       ``(E) the Department of Justice; and
       ``(F) any other person that the Commission determines to be 
     appropriate, including--
       ``(i) foreign financial supervisors (including foreign 
     futures authorities);
       ``(ii) foreign central banks; and
       ``(iii) foreign ministries.
       ``(b) Standard Setting.--
       ``(1) Data identification.--The Commission shall prescribe 
     standards that specify the data elements for each non-
     security-based swap, including whether the transaction is a 
     bona fide hedging swap transaction as defined in section 1a, 
     that shall be collected and maintained by each registered 
     non-security-based swap data repository.
       ``(2) Data collection and maintenance.--The Commission 
     shall prescribe data collection and data maintenance 
     standards for non-security-based swap data repositories.
       ``(3) Comparability.--The standards prescribed by the 
     Commission under this subsection shall be comparable to the 
     data standards imposed by the Commission on derivatives 
     clearing organizations in connection with their clearing of 
     non-security-based swaps.
       ``(c) Duties.--A registered non-security-based swap data 
     repository shall--
       ``(1) accept data prescribed by the Commission for one or 
     more non-security-based swaps;
       ``(2) confirm with both counterparties to the non-security-
     based swap the accuracy of the data that was submitted;
       ``(3) maintain the data described in paragraph (1) in such 
     form, in such manner, and for such period as may be required 
     by the Commission;
       ``(4)(A) provide direct electronic access to the Commission 
     (or any designee of the Commission, including another 
     registered entity); and
       ``(B) provide the information described in paragraph (1) in 
     such form and at such frequency as the Commission may require 
     to comply with the public reporting requirements contained in 
     section 726 of the Over-the-Counter Swaps Markets 
     Transparency and Accountability Act of 2010;
       ``(5) at the direction of the Commission, establish 
     automated systems for monitoring,

[[Page S3182]]

     screening, and analyzing non-security-based swap data;
       ``(6) maintain the confidentiality non-security-based swap 
     transaction information that the registered non-security-
     based swap data repository receives from a counterparty, swap 
     participant, or any other registered entity in accordance 
     with the requirements that the Commission shall jointly with 
     the Securities and Exchange Commission prescribe through 
     notice-and-comment rulemaking.
       ``(d) Core Principles Applicable to Registered Non-
     security-based Swap Data Repositories.--
       ``(1) Antitrust considerations.--Unless specifically 
     reviewed and approved by the Commission for antitrust 
     purposes, a registered non-security-based swap data 
     repository may not--
       ``(A) adopt any rule or take any action that results in any 
     unreasonable restraint of trade; or
       ``(B) impose any material anticompetitive burden on the 
     trading, clearing, or reporting of transactions.
       ``(2) Governance arrangements.--Each registered non-
     security-based swap data repository shall establish 
     governance arrangements that are transparent and assure fair 
     representation of its participants in reasonable proportion 
     to their use of the non-security-based data repository in the 
     selection of its directors and administration of its affairs.
       ``(3) Conflicts of interest.--Each registered non-security-
     based swap data repository shall--
       ``(A) establish and enforce rules to minimize conflicts of 
     interest in the decision-making process of the non-security-
     based swap data repository; and
       ``(B) establish a process for resolving conflicts of 
     interest described in subparagraph (A).
       ``(4) Nondiscriminatory access.--A registered non-security-
     based swap data repository--
       ``(A) may not mandate directly or indirectly the 
     substantive terms and conditions of transactions reported to 
     the non-security-based data repository;
       ``(B) must provide for the equitable allocation of 
     reasonable dues, fees, and other charges among its 
     participants and must not impose any schedule of prices, or 
     fix rates or other fees, for services rendered by its 
     participants;
       ``(C) provide for participation in the non-security-based 
     swap data repository by any swap participant and any other 
     person or class of persons as the Commission, by rule or 
     regulation, may determine to be necessary or appropriate in 
     furtherance of the purposes of this section; and
       ``(D) may not unfairly discriminate in the admission of 
     participants or among participants in the use of the non-
     security-based swap data repository.
       ``(e) Rules.--The Commission shall adopt rules, jointly 
     with the Securities and Exchange Commission, governing 
     persons that are registered under this section.''.

     SEC. 728. LARGE NON-SECURITY-BASED SWAP TRADER REPORTING.

       The Commodity Exchange Act (7 U.S.C. 1 et seq.) is amended 
     by adding after section 4s (as added by section 729) the 
     following:

     ``SEC. 4T. LARGE NON-SECURITY-BASED SWAP TRADER REPORTING.

       ``(a) Prohibition.--
       ``(1) In general.--Except as provided in paragraph (2), it 
     shall be unlawful for any person to enter into any non-
     security-based swap that the Commission determines to perform 
     a significant price discovery function with respect to 
     registered entities if--
       ``(A) the person directly or indirectly enters into the 
     non-security-based swap during any 1 day in an amount equal 
     to or in excess of such amount as shall be established 
     periodically by the Commission; and
       ``(B) the person directly or indirectly has or obtains a 
     position in the non-security-based swap equal to or in excess 
     of such amount as shall be established periodically by the 
     Commission.
       ``(2) Exception.--Paragraph (1) shall not apply if--
       ``(A) the person files or causes to be filed with the 
     properly designated officer of the Commission such reports 
     regarding any transactions or positions described in 
     subparagraphs (A) and (B) of paragraph (1) as the Commission 
     may require by rule or regulation; and
       ``(B) in accordance with the rules and regulations of the 
     Commission, the person keeps books and records of all such 
     non-security-based swaps and any transactions and positions 
     in any related commodity traded on or subject to the rules of 
     any board of trade, and of cash or spot transactions in, 
     inventories of, and purchase and sale commitments of, such a 
     commodity.
       ``(b) Requirements.--Books and records described in 
     subsection (a)(2)(B) shall--
       ``(1) show such complete details concerning all 
     transactions and positions as the Commission may prescribe by 
     rule or regulation; and
       ``(2) be open at all times to inspection and examination by 
     any representative of the Commission.
       ``(c) Applicability.--For purposes of this section, the 
     non-security-based swaps, futures, and cash or spot 
     transactions and positions of any person shall include the 
     non-security-based swaps, futures, and cash or spot 
     transactions and positions of any persons directly or 
     indirectly controlled by the person.
       ``(d) Significant Price Discovery Function.--In making a 
     determination as to whether a non-security-based swap 
     performs or affects a significant price discovery function 
     with respect to registered entities, the Commission shall 
     consider the factors described in section 4a(a)(3).''.

     SEC. 729. REGISTRATION AND REGULATION OF SWAP PARTICIPANTS.

       The Commodity Exchange Act (7 U.S.C. 1 et seq.) is amended 
     by inserting after section 4r (as added by section 726) the 
     following:

     ``SEC. 4S. REGISTRATION AND REGULATION OF SWAP PARTICIPANTS.

       ``(a) Registration.--Swap participants must register with 
     the Commission.
       ``(b) Notice Registration.--A swap participants shall be 
     exempt from registration with the Commission, if it files a 
     notice registration with the Commission in the form and 
     manner that the Commission shall prescribe, jointly with the 
     Securities and Exchange Commission, by notice-and-comment 
     rulemaking and--
       ``(1) it is exempt pursuant to a rule or order, issued by 
     the Commission, jointly with the Securities and Exchange 
     Commission, to exempt swap participants that engage primarily 
     in security-based swap transactions and are registered as 
     swap participants with the Securities and Exchange 
     Commission; or
       ``(2) all of its outstanding swap transactions are cleared 
     swaps.
       ``(c) Requirements.--
       ``(1) In general.--A person shall register as a swap 
     participant by filing a registration application with the 
     Commission.
       ``(2) Contents.--
       ``(A) In general.--The application shall be made in such 
     form and manner and containing such information as the 
     Commission, jointly with the Securities and Exchange 
     Commission through notice-and-comment rulemaking, shall 
     prescribe concerning the swap participant's swap activities.
       ``(B) Continual reporting.--A person that is registered as 
     a swap participant shall continue to submit to the Commission 
     reports that contain such information pertaining to the swap 
     participant's swap activities as the Commission may require.
       ``(3) Transition.--Rules under this section shall provide 
     for the registration of swap participants 1 year after the 
     date of enactment of the Over-the-Counter Swaps Markets 
     Transparency and Accountability Act of 2010.
       ``(4) Statutory disqualification.--Except to the extent 
     otherwise specifically provided by rule, regulation, or 
     order, it shall be unlawful for a swap participant to permit 
     any person associated with a swap participant who is subject 
     to a statutory disqualification to effect or be involved in 
     effecting swaps on behalf of the swap participant, if the 
     swap participant knew, or in the exercise of reasonable care 
     should have known, of the statutory disqualification.
       ``(d) Capital and Margin Requirements.--
       ``(1) Capital requirements for prudentially regulated swap 
     participants.--Each swap participant for which there is a 
     prudential regulator shall meet such minimum capital 
     requirements as such prudential regulator shall prescribe 
     pursuant to the authority of the prudential regulator.
       ``(2) Margin requirements for swap participants for 
     uncleared non-security-based swaps.--
       ``(A) In general.--Except as provided in subparagraph (C), 
     the Commission shall prescribe by rule or regulation the 
     minimum margin requirements that apply to transactions 
     between swap participants in a particular uncleared non-
     security-based swap or any group, category, type, or class of 
     uncleared non-security-based swap, as the Commission deems 
     appropriate for the risk of that particular uncleared non-
     security-based swap or class, group, category, type of 
     uncleared non-security-based swap, for the purposes of--
       ``(i) reducing the risk of losses to counterparties; and
       ``(ii) preserving the financial integrity of markets 
     trading non-security-based swaps.
       ``(B) Considerations.--The Commission shall not issue rules 
     under this subsection unless the Commission determines that 
     such rules--
       ``(i) would not inappropriately encourage or discourage the 
     clearing of certain non-security-based swaps, resulting in an 
     undue increase in risk to the financial system;
       ``(ii) are supported by economic analysis provided by the 
     Chief Economist of the Commission; and
       ``(iii) would not impose any unnecessary burden on 
     competition.
       ``(C) Exceptions.--The Commission shall not impose minimum 
     margin requirements on--
       ``(i) positions in foreign exchange forwards, swaps, or 
     options; and
       ``(ii) non-security-based swap transactions in which one 
     counterparty directly or indirectly controls, is controlled 
     by, or is under common control with the other counterparty, 
     provided, however, that the Commission, jointly with the 
     Financial Stability Oversight Council, may determine, by 
     notice-and-comment rulemaking, that transactions between 
     certain parties under common control are subject to the 
     minimum margin requirements imposed by the Commission under 
     this subsection.
       ``(D) Outstanding swap positions.--The Commission and the 
     Securities and Exchange Commission may by joint notice-and-
     comment rulemaking or order exempt any

[[Page S3183]]

     swap, group, category, type, or class of swap entered into on 
     or before the date of enactment of this Act. In determining 
     whether an exemption is appropriate, the Commission and the 
     Securities and Exchange Commission shall take into account 
     the notional value, the tenor, and the risk to the financial 
     stability of the United States posed by the underlying swap, 
     group, category, type, or class of swap.
       ``(3) Special margin requirements for uncleared swap 
     transactions involving a swap participant with a substantial 
     net uncollateralized swap position.--
       ``(A) In general.--If a swap participant has a substantial 
     net uncollateralized swap position, any subsequent swap 
     transaction, regardless of whether the swap participant's 
     counterparty is a swap participant, shall be subject to--
       ``(i) any applicable clearing requirement under section 
     (h); and
       ``(ii) any applicable margin requirements that the 
     Commission has prescribed under paragraph (2).
       ``(B) Substantial net uncollateralized position.--
       ``(i) In general.--From time to time, the Financial 
     Stability Oversight Council shall define, by rule or 
     regulation, `substantial net uncollateralized swap position' 
     by identifying the level of a net uncollateralized position 
     in swaps that a swap participant can hold without posing a 
     threat to the financial system stability of the United 
     States.
       ``(ii) Reliance on economic analysis.--In making 
     determinations under this subsection, the Commission and the 
     Board of Governors shall rely on economic analysis provided 
     by economists of the Commission and economists of the Board 
     of Governors.
       ``(e) Reporting and Recordkeeping.--With respect to its 
     swap business, each swap participant registered with the 
     Commission--
       ``(1) shall make such reports as are required by the 
     Commission, jointly with the Securities and Exchange 
     Commission through notice-and-comment rulemaking;
       ``(2)(A) for which there is a prudential regulator, shall 
     keep books and records in such form and manner and for such 
     period as may be prescribed by the prudential regulator; and
       ``(B) for which there is no prudential regulator, shall 
     keep books and records in such form and manner and for such 
     period as is prescribed by the Commission, jointly with the 
     Securities and Exchange Commission through notice-and-comment 
     rulemaking, by rule or regulation; and
       ``(3) shall keep books and records described in 
     subparagraph (B) open to inspection and examination by any 
     representative of the Commission.
       ``(f) Business Conduct Standards and Requirements.--With 
     respect to its swap business, each swap participant--
       ``(1) for which there is a prudential regulator, shall 
     comply with such business conduct standards and requirements 
     as the prudential regulator may impose; and
       ``(2) for which there is no prudential regulator, shall 
     comply with such business conduct standards and requirements 
     as the Commission, jointly with the Securities and Exchange 
     Commission through notice-and-comment rulemaking, shall 
     prescribe. Such business conduct requirements shall--
       ``(A) establish the standard of care required for a swap 
     participant to verify that any counterparty meets the 
     eligibility standards for an eligible contract participant; 
     and
       ``(B) require disclosure by the swap participant to any 
     counterparty to the swap (other than a counterparty that is a 
     swap participant) of--
       ``(i) information about the material risks and 
     characteristics of the swap; and
       ``(ii) any material conflicts of interest that the swap 
     participant may have in connection with the swap.
       ``(g) Documentation and Back Office Standards.--Each swap 
     participant registered with the Commission--
       ``(1) for which there is a prudential regulator, shall 
     comply with such documentation and back office standards as 
     the prudential regulator may impose; and
       ``(2) for which there is no prudential regulator, shall 
     conform with such standards as the Commission, jointly with 
     the Securities and Exchange Commission through notice-and-
     comment rulemaking, may prescribe that relate to timely and 
     accurate confirmation, processing, netting, documentation, 
     and valuation of all swaps.
       ``(h) Confidentiality.--Notwithstanding any other provision 
     of law, the Commission may not be compelled to disclose any 
     information required by Commission rule or regulation to be 
     reported to the Commission under this subsection, except that 
     nothing in this paragraph authorizes the Commission to 
     withhold information from Congress, or prevent the Commission 
     from complying with a request for information from any other 
     Federal department or agency requesting information for 
     purposes within the scope of its jurisdiction, 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 
     subsection shall be considered a statute described in 
     subsection (b)(3)(B) of such section 552.''.

     SEC. 730. NON-SECURITY-BASED SWAP EXECUTION FACILITIES.

       The Commodity Exchange Act is amended by inserting after 
     section 5g (7 U.S.C. 7b-2) the following:

     ``SEC. 5H. NON-SECURITY-BASED SWAP EXECUTION FACILITIES.

       ``(a) Registration.--
       ``(1) In general.--No person may operate a facility for the 
     trading or processing of non-security-based swaps unless the 
     facility is registered as a non-security-based swap execution 
     facility or as a designated contract market under this 
     section.
       ``(2) Dual registration.--Any person that is required to 
     register as a non-security-based swap execution facility 
     under this section shall register with the Commission 
     regardless of whether the person also is registered with the 
     Securities and Exchange Commission.
       ``(b) Trading and Trade Processing.--A non-security-based 
     swap execution facility that is registered under subsection 
     (a) may--
       ``(1) make available for trading any non-security-based 
     swap; and
       ``(2) facilitate trade processing of any non-security-based 
     swap.
       ``(c) Trading by Contract Markets.--A board of trade that 
     operates a contract market shall, to the extent that the 
     board of trade also operates a non-security-based swap 
     execution facility and uses the same electronic trade 
     execution system for trading on the contract market and the 
     non-security-based swap execution facility, identify whether 
     the electronic trading is taking place on the contract market 
     or the non-security-based swap execution facility.
       ``(d) Core Principles for Non-security-based Swap Execution 
     Facilities.--
       ``(1) Compliance with core principles.--
       ``(A) In general.--To be registered, and maintain 
     registration, as a non-security-based swap execution 
     facility, the non-security-based swap execution facility 
     shall comply with--
       ``(i) the core principles described in this subsection; and
       ``(ii) any requirement that the Commission may impose by 
     rule or regulation pursuant to section 8a(5).
       ``(B) Reasonable discretion of non-security-based swap 
     execution facility.--Unless otherwise determined by the 
     Commission by rule or regulation, a non-security-based swap 
     execution facility described in subparagraph (A) shall have 
     reasonable discretion in establishing the manner in which the 
     non-security-based swap execution facility complies with the 
     core principles described in this subsection.
       ``(2) Compliance with rules.--A non-security-based swap 
     execution facility shall--
       ``(A) monitor and enforce compliance with any rule of the 
     non-security-based swap execution facility, including--
       ``(i) the terms and conditions of the non-security-based 
     swaps traded or processed on or through the non-security-
     based swap execution facility; and
       ``(ii) any limitation on access to the non-security-based 
     swap execution facility; and
       ``(B) establish and enforce trading, trade processing, and 
     participation rules that will deter abuses and have the 
     capacity to detect, investigate, and enforce those rules, 
     including means--
       ``(i) to provide market participants with impartial access 
     to the market; and
       ``(ii) to capture information that may be used in 
     establishing whether rule violations have occurred.
       ``(3) Swaps not readily susceptible to manipulation.--The 
     non-security-based swap execution facility shall permit 
     trading only in non-security-based swaps that are not readily 
     susceptible to manipulation.
       ``(4) Monitoring of trading and trade processing.--The non-
     security-based swap execution facility shall--
       ``(A) establish and enforce rules or terms and conditions 
     defining, or specifications detailing--
       ``(i) trading procedures to be used in entering and 
     executing orders traded on or through the facilities of the 
     non-security-based swap execution facility; and
       ``(ii) procedures for trade processing of non-security-
     based swaps on or through the facilities of the non-security-
     based swap execution facility; and
       ``(B) monitor trading in non-security-based swaps to 
     prevent manipulation, price distortion, and disruptions of 
     the delivery or cash settlement process through surveillance, 
     compliance, and disciplinary practices and procedures, 
     including methods for conducting real-time monitoring of 
     trading and comprehensive and accurate trade reconstructions.
       ``(5) Information sharing.--The non-security-based swap 
     execution facility shall--
       ``(A) establish and enforce rules that will allow the 
     facility to obtain any necessary information to perform any 
     of the functions described in this section;
       ``(B) provide the information to the following on request--
       ``(i) the Commission;
       ``(ii) the Securities and Exchange Commission;
       ``(iii) the Board;
       ``(iv) each appropriate prudential regulator;
       ``(v) the Council;
       ``(vi) the Department of Justice; and
       ``(vii) any other foreign regulatory authority that the 
     Commission determines to be appropriate and with whom the 
     Commission has entered into an information sharing agreement; 
     and
       ``(C) have the capacity to carry out such international 
     information-sharing agreements as the Commission may require.
       ``(6) Position limits or accountability.--

[[Page S3184]]

       ``(A) In general.--To reduce the potential threat of market 
     manipulation or congestion, especially during trading in the 
     delivery month, the non-security-based swap execution 
     facility shall adopt for each of the contracts of the 
     facility, as is necessary and appropriate, position 
     limitations or position accountability for speculators.
       ``(B) Position limits.--For any contract that is subject to 
     a position limitation established by the Commission pursuant 
     to section 4a(a), the non-security-based swap execution 
     facility shall set its position limitation at a level no 
     higher than the Commission limitation.
       ``(C) Position enforcement.--For any contract that is 
     subject to a position limitation established by the 
     Commission pursuant to section 4a(a), a non-security-based 
     swap execution facility shall reject any proposed non-
     security-based swap transaction if, based on information 
     readily available to a non-security-based swap execution 
     facility, any proposed non-security-based swap transaction 
     would cause a non-security-based swap execution facility 
     customer that would be a party to such swap transaction to 
     exceed such position limitation.
       ``(7) Financial integrity of transactions.--The non-
     security-based swap execution facility shall establish and 
     enforce rules and procedures for ensuring the financial 
     integrity of non-security-based swaps entered on or through 
     the facilities of the non-security-based swap execution 
     facility, including the clearance and settlement of the non-
     security-based swaps pursuant to section 2(h)(1).
       ``(8) Emergency authority.--The non-security-based swap 
     execution facility shall adopt rules to provide for the 
     exercise of emergency authority, in consultation or 
     cooperation with the Commission, as is necessary and 
     appropriate, including the authority to liquidate or transfer 
     open positions in any non-security-based swap or to suspend 
     or curtail trading in a non-security-based swap.
       ``(9) Timely publication of trading information.--
       ``(A) In general.--The non-security-based swap execution 
     facility shall make public timely information on price, 
     trading volume, and other trading data on non-security-based 
     swaps to the extent prescribed by the Commission.
       ``(B) Capacity of non-security-based swap execution 
     facility.--The non-security-based swap execution facility 
     shall be required to have the capacity to electronically 
     capture trade information with respect to transactions 
     executed on the facility.
       ``(10) Recordkeeping and reporting.--
       ``(A) In general.--A non-security-based swap execution 
     facility shall--
       ``(i) maintain records of all activities relating to the 
     business of the facility, including a complete audit trail, 
     in a form and manner acceptable to the Commission for a 
     period of 5 years; and
       ``(ii) report to the Commission, in a form and manner 
     acceptable to the Commission, such information as the 
     Commission determines to be necessary or appropriate for the 
     Commission to perform the duties of the Commission under this 
     Act.
       ``(B) Requirements.--The Commission shall adopt data 
     collection and reporting requirements for non-security-based 
     swap execution facilities that are comparable to 
     corresponding requirements for derivatives clearing 
     organizations and non-security-based swap data repositories.
       ``(11) Antitrust considerations.--Unless necessary or 
     appropriate to achieve the purposes of this Act, the non-
     security-based swap execution facility shall avoid--
       ``(A) adopting any rules or taking any actions that result 
     in any unreasonable restraint of trade; or
       ``(B) imposing any material anticompetitive burden on 
     trading or clearing.
       ``(12) Conflicts of interest.--The non-security-based swap 
     execution facility shall--
       ``(A) establish and enforce rules to minimize conflicts of 
     interest in its decision-making process; and
       ``(B) establish a process for resolving the conflicts of 
     interest.
       ``(13) Financial resources.--
       ``(A) In general.--The non-security-based swap execution 
     facility shall have adequate financial, operational, and 
     managerial resources to discharge each responsibility of the 
     non-security-based swap execution facility.
       ``(B) Determination of resource adequacy.--The financial 
     resources of a non-security-based swap execution facility 
     shall be considered to be adequate if the value of the 
     financial resources exceeds the total amount that would 
     enable the non-security-based swap execution facility to 
     cover the operating costs of the non-security-based swap 
     execution facility for a 1-year period, as calculated on a 
     rolling basis.
       ``(14) System safeguards.--The non-security-based swap 
     execution facility shall--
       ``(A) establish and maintain a program of risk analysis and 
     oversight to identify and minimize sources of operational 
     risk, through the development of appropriate controls and 
     procedures, and automated systems, that--
       ``(i) are reliable and secure; and
       ``(ii) have adequate scalable capacity;
       ``(B) establish and maintain emergency procedures, backup 
     facilities, and a plan for disaster recovery that are 
     designed to allow for--
       ``(i) the timely recovery and resumption of operations; and
       ``(ii) the fulfillment of the responsibilities and 
     obligation of the non-security-based swap execution facility; 
     and
       ``(C) periodically conduct tests to verify that the backup 
     resources of the non-security-based swap execution facility 
     are sufficient to ensure continued--
       ``(i) order processing and trade matching;
       ``(ii) price reporting;
       ``(iii) market surveillance and
       ``(iv) maintenance of a comprehensive and accurate audit 
     trail.
       ``(e) Exemptions.--The Commission may exempt, conditionally 
     or unconditionally, a non-security-based swap execution 
     facility from registration under this section if the 
     Commission finds that the facility is subject to comparable, 
     comprehensive supervision and regulation on a consolidated 
     basis by the Securities and Exchange Commission, a prudential 
     regulator, or the appropriate governmental authorities in the 
     home country of the facility.
       ``(f) Rules.--The Commission shall prescribe rules 
     governing the regulation of alternative non-security-based 
     swap execution facilities under this section.''.

     SEC. 731. DERIVATIVES TRANSACTION EXECUTION FACILITIES AND 
                   EXEMPT BOARDS OF TRADE.

       (a) In General.--Sections 5a and 5d of the Commodity 
     Exchange Act (7 U.S.C. 7a, 7a-3) are repealed.
       (b) Conforming Amendments.--
       (1) Section 2 of the Commodity Exchange Act (7 U.S.C. 2) is 
     amended--
       (A) in subsection (a)(1)(A), in the first sentence, by 
     striking ``or 5a''; and
       (B) in paragraph (2) of subsection (g) (as redesignated by 
     section 723(a)(1)(B)), by striking ``section 5a of this Act'' 
     and all that follows through ``5d of this Act'' and inserting 
     ``section 5b of this Act''.
       (2) Section 6(g)(1)(A) of the Securities Exchange Act of 
     1934 (15 U.S.C. 78f(g)(1)(A)) is amended--
       (A) by striking ``that--'' and all that follows through 
     ``(i) has been designated'' and inserting ``that has been 
     designated'';
       (B) by striking ``; or'' and inserting ``; and'' and
       (C) by striking clause (ii).

     SEC. 732. DESIGNATED CONTRACT MARKETS.

       (a) Criteria for Designation.--Section 5 of the Commodity 
     Exchange Act (7 U.S.C. 7) is amended by striking subsection 
     (b).
       (b) Core Principles for Contract Markets.--Section 5 of the 
     Commodity Exchange Act (7 U.S.C. 7) is amended by striking 
     subsection (d) and inserting the following:
       ``(d) Core Principles for Contract Markets.--
       ``(1) Designation as board of trade.--
       ``(A) In general.--To be designated, and maintain a 
     designation, as a contract market, a board of trade shall 
     comply with--
       ``(i) any core principle described in this subsection; and
       ``(ii) any requirement that the Commission may impose by 
     rule or regulation pursuant to section 8a(5).
       ``(B) Reasonable discretion of board of trade.--Unless 
     otherwise determined by the Commission by rule or regulation, 
     a board of trade described in subparagraph (A) shall have 
     reasonable discretion in establishing the manner in which the 
     board of trade complies with the core principles described in 
     this subsection.
       ``(2) Compliance with rules.--
       ``(A) In general.--The board of trade shall establish, 
     monitor, and enforce compliance with the rules of the 
     contract market, including--
       ``(i) access requirements;
       ``(ii) the terms and conditions of any contracts to be 
     traded on the contract market; and
       ``(iii) rules prohibiting abusive trade practices on the 
     contract market.
       ``(B) Capacity of board of trade.--The board of trade shall 
     have the capacity to detect, investigate, and apply 
     appropriate sanctions to any person that violates any rule of 
     the contract market.
       ``(C) Requirement of rules.--The rules of the contract 
     market shall provide the board of trade with the ability and 
     authority to obtain any necessary information to perform any 
     function described in this subsection, including the capacity 
     to carry out such international information-sharing 
     agreements as the Commission may require.
       ``(3) Contracts not readily subject to manipulation.--The 
     board of trade shall list on the contract market only 
     contracts that are not readily susceptible to manipulation.
       ``(4) Prevention of market disruption.--The board of trade 
     shall have the capacity and responsibility to prevent 
     manipulation, price distortion, and disruptions of the 
     delivery or cash-settlement process through market 
     surveillance, compliance, and enforcement practices and 
     procedures, including--
       ``(A) methods for conducting real-time monitoring of 
     trading; and
       ``(B) comprehensive and accurate trade reconstructions.
       ``(5) Position limitations or accountability.--
       ``(A) In general.--To reduce the potential threat of market 
     manipulation or congestion (especially during trading in the 
     delivery month), the board of trade shall adopt for each 
     contract of the board of trade, as is necessary and 
     appropriate, position limitations or position accountability 
     for speculators.
       ``(B) Maximum allowable position limitation.--For any 
     contract that is subject to a position limitation established 
     by the Commission pursuant to section 4a(a), the board

[[Page S3185]]

     of trade shall set the position limitation of the board of 
     trade at a level not higher than the position limitation 
     established by the Commission.
       ``(6) Emergency authority.--The board of trade, in 
     consultation or cooperation with the Commission, shall adopt 
     rules to provide for the exercise of emergency authority, as 
     is necessary and appropriate, including the authority--
       ``(A) to liquidate or transfer open positions in any 
     contract;
       ``(B) to suspend or curtail trading in any contract; and
       ``(C) to require market participants in any contract to 
     meet special margin requirements.
       ``(7) Availability of general information.--The board of 
     trade shall make available to market authorities, market 
     participants, and the public accurate information 
     concerning--
       ``(A) the terms and conditions of the contracts of the 
     contract market; and
       ``(B)(i) the rules, regulations, and mechanisms for 
     executing transactions on or through the facilities of the 
     contract market; and
       ``(ii) the rules and specifications describing the 
     operation of the contract market's--
       ``(I) electronic matching platform; or
       ``(II) trade execution facility.
       ``(8) Daily publication of trading information.--The board 
     of trade shall make public daily information on settlement 
     prices, volume, open interest, and opening and closing ranges 
     for actively traded contracts on the contract market.
       ``(9) Execution of transactions.--
       ``(A) In general.--The board of trade shall provide a 
     competitive, open, and efficient market and mechanism for 
     executing transactions that protects the price discovery 
     process of trading in the centralized market of the board of 
     trade.
       ``(B) Rules.--The rules of the board of trade may 
     authorize, for bona fide business purposes--
       ``(i) transfer trades or office trades;
       ``(ii) an exchange of--

       ``(I) futures in connection with a cash commodity 
     transaction;
       ``(II) futures for cash commodities; or
       ``(III) futures for non-security-based swaps; or

       ``(iii) a futures commission merchant, acting as principal 
     or agent, to enter into or confirm the execution of a 
     contract for the purchase or sale of a commodity for future 
     delivery if the contract is reported, recorded, or cleared in 
     accordance with the rules of the contract market or a 
     derivatives clearing organization.
       ``(10) Trade information.--The board of trade shall 
     maintain rules and procedures to provide for the recording 
     and safe storage of all identifying trade information in a 
     manner that enables the contract market to use the 
     information--
       ``(A) to assist in the prevention of customer and market 
     abuses; and
       ``(B) to provide evidence of any violations of the rules of 
     the contract market.
       ``(11) Financial integrity of transactions.--The board of 
     trade shall establish and enforce--
       ``(A) rules and procedures for ensuring the financial 
     integrity of transactions entered into on or through the 
     facilities of the contract market (including the clearance 
     and settlement of the transactions with a derivatives 
     clearing organization); and
       ``(B) rules to ensure--
       ``(i) the financial integrity of any--

       ``(I) futures commission merchant; and
       ``(II) introducing broker; and

       ``(ii) the protection of customer funds.
       ``(12) Protection of markets and market participants.--The 
     board of trade shall establish and enforce rules--
       ``(A) to protect markets and market participants from 
     abusive practices committed by any party, including abusive 
     practices committed by a party acting as an agent for a 
     participant; and
       ``(B) to promote fair and equitable trading on the contract 
     market.
       ``(13) Disciplinary procedures.--The board of trade shall 
     establish and enforce disciplinary procedures that authorize 
     the board of trade to discipline, suspend, or expel members 
     or market participants that violate the rules of the board of 
     trade, or similar methods for performing the same functions, 
     including delegation of the functions to third parties.
       ``(14) Dispute resolution.--The board of trade shall 
     establish and enforce rules regarding, and provide facilities 
     for alternative dispute resolution as appropriate for, market 
     participants and any market intermediaries.
       ``(15) Governance fitness standards.--The board of trade 
     shall establish and enforce appropriate fitness standards for 
     directors, members of any disciplinary committee, members of 
     the contract market, and any other person with direct access 
     to the facility (including any party affiliated with any 
     person described in this paragraph).
       ``(16) Conflicts of interest.--The board of trade shall 
     establish and enforce rules--
       ``(A) to minimize conflicts of interest in the decision-
     making process of the contract market; and
       ``(B) to establish a process for resolving conflicts of 
     interest described in subparagraph (A).
       ``(17) Composition of governing boards of contract 
     markets.--The governance arrangements of the board of trade 
     shall be designed to promote the objectives of market 
     participants.
       ``(18) Recordkeeping.--The board of trade shall maintain 
     records of all activities relating to the business of the 
     contract market--
       ``(A) in a form and manner that is acceptable to the 
     Commission; and
       ``(B) for a period of at least 5 years.
       ``(19) Antitrust considerations.--Unless appropriate to 
     achieve the purposes of this Act, the board of trade shall, 
     to the maximum extent practicable, avoid--
       ``(A) adopting any rule or taking any action that results 
     in any unreasonable restraint of trade; or
       ``(B) imposing any material anticompetitive burden on 
     trading on the contract market.
       ``(20) System safeguards.--The board of trade shall--
       ``(A) establish and maintain a program of risk analysis and 
     oversight to identify and minimize sources of operational 
     risk, through the development of appropriate controls and 
     procedures, and the development of automated systems, that 
     are reliable, secure, and have adequate scalable capacity;
       ``(B) establish and maintain emergency procedures, backup 
     facilities, and a plan for disaster recovery that allow for 
     the timely recovery and resumption of operations and the 
     fulfillment of the responsibilities and obligations of the 
     board of trade; and
       ``(C) periodically conduct tests to verify that backup 
     resources are sufficient to ensure continued order processing 
     and trade matching, price reporting, market surveillance, and 
     maintenance of a comprehensive and accurate audit trail.
       ``(21) Financial resources.--
       ``(A) In general.--The board of trade shall have adequate 
     financial, operational, and managerial resources to discharge 
     each responsibility of the board of trade.
       ``(B) Determination of adequacy.--The financial resources 
     of the board of trade shall be considered to be adequate if 
     the value of the financial resources exceeds the total amount 
     that would enable the contract market to cover the operating 
     costs of the contract market for a 1-year period, as 
     calculated on a rolling basis.''.

     SEC. 733. MARGIN.

       Section 8a(7) of the Commodity Exchange Act (7 U.S.C. 
     12a(7)) is amended--
       (1) in subparagraph (C), by striking ``, excepting the 
     setting of levels of margin'';
       (2) by redesignating subparagraphs (D) through (F) as 
     subparagraphs (E) through (G), respectively; and
       (3) by inserting after subparagraph (C) the following:
       ``(D) margin requirements, provided that the rules, 
     regulations, or orders shall--
       ``(i) be limited to protecting the financial integrity of 
     the derivatives clearing organization;
       ``(ii) be designed for risk management purposes to protect 
     the financial integrity of transactions; and
       ``(iii) not set specific margin amounts;''.

     SEC. 734. POSITION LIMITS ON NON-SECURITY-BASED SWAPS.

       (a) Aggregate Position Limits.--Section 4a(a) of the 
     Commodity Exchange Act (7 U.S.C. 6a(a)) is amended--
       (1) by inserting after ``(a)'' the following: ``(1) in 
     general.--'';
       (2) in the first sentence, by striking ``on electronic 
     trading facilities with respect to a significant price 
     discovery contract'' and inserting ``non-security-based swaps 
     that perform or affect a significant price discovery function 
     with respect to registered entities'';
       (3) in the second sentence--
       (A) by inserting ``, including any group or class of 
     traders,'' after ``held by any person''; and
       (B) by striking ``on an electronic trading facility with 
     respect to a significant price discovery contract,'' and 
     inserting ``non-security-based swaps traded on or subject to 
     the rules of a non-security-based swaps execution facility, 
     or non-security-based swaps not traded on or subject to the 
     rules of a non-security-based swaps execution facility that 
     perform a significant price discovery function with respect 
     to a registered entity,''; and
       (4) by adding at the end the following:
       ``(2) Aggregate position limits.--The Commission may, by 
     rule or regulation, establish limits (including related hedge 
     exemption provisions) on the aggregate number or amount of 
     positions in contracts based on the same underlying commodity 
     (as defined by the Commission) that may be held by any 
     person, including any group or class of traders, for each 
     month across--
       ``(A) contracts listed by designated contract markets;
       ``(B) with respect to an agreement, contract, or 
     transaction that settles against, or in relation to, any 
     price (including the daily or final settlement price) of 1 or 
     more contracts listed for trading on a registered entity, 
     contracts traded on a foreign board of trade that provides 
     members or other participants located in the United States 
     with direct access to the electronic trading and order 
     matching system of the foreign board of trade;
       ``(C) non-security-based swaps traded on or subject to the 
     rules of a non-security-based swap execution facility; and
       ``(D) non-security-based swaps not traded on or subject to 
     the rules of a non-security-based swap execution facility 
     that perform or affect a significant price discovery function 
     with respect to a registered entity.
       ``(3) Significant price discovery function.--In making a 
     determination as to

[[Page S3186]]

     whether a non-security-based swap performs or affects a 
     significant price discovery function with respect to 
     registered entities, the Commission shall consider, as 
     appropriate, the following factors:
       ``(A) Price linkage.--The extent to which the non-security-
     based swap uses or otherwise relies on a daily or final 
     settlement price, or other major price parameter, of another 
     contract traded on a registered entity based on the same 
     underlying commodity, to value a position, transfer or 
     convert a position, financially settle a position, or close 
     out a position.
       ``(B) Arbitrage.--The extent to which the price for the 
     non-security-based swap is sufficiently related to the price 
     of another contract traded on a registered entity based on 
     the same underlying commodity so as to permit market 
     participants to effectively arbitrage between the markets by 
     simultaneously maintaining positions or executing trades in 
     the non-security-based swaps on a frequent and recurring 
     basis.
       ``(C) Material price reference.--The extent to which, on a 
     frequent and recurring basis, bids, offers, or transactions 
     in a contract traded on a registered entity are directly 
     based on, or are determined by referencing, the price 
     generated by the swap.
       ``(D) Material liquidity.--The extent to which the volume 
     of non-security-based swaps being traded in the commodity is 
     sufficient to have a material effect on another contract 
     traded on a registered entity.
       ``(E) Other material factors.--Such other material factors 
     as the Commission specifies by rule or regulation as relevant 
     to determine whether a non-security-based swap serves a 
     significant price discovery function with respect to a 
     regulated market.
       ``(4) Exemptions.--The Commission, by rule, regulation, or 
     order, may exempt, conditionally or unconditionally, any 
     person or class of persons, any non-security-based swap or 
     class of non-security-based swaps, or any transaction or 
     class of transactions from any requirement that the 
     Commission establishes under this section with respect to 
     position limits.''.
       (b) Conforming Amendments.--Section 4a(b) of the Commodity 
     Exchange Act (7 U.S.C. 6a(b)) is amended--
       (1) in paragraph (1), by striking ``or derivatives 
     transaction execution facility or facilities or electronic 
     trading facility'' and inserting ``or non-security-based swap 
     execution facility or facilities''; and
       (2) in paragraph (2), by striking ``or derivatives 
     transaction execution facility or facilities or electronic 
     trading facility'' and inserting ``or non-security-based swap 
     execution facility''.

     SEC. 735. FOREIGN BOARDS OF TRADE.

       (a) In General.--Section 4(b) of the Commodity Exchange Act 
     (7 U.S.C. 6(b)) is amended--
       (1) in the first sentence, by striking ``The Commission'' 
     and inserting the following:
       ``(2) Persons located in the united states.--
       ``(3) In general.--The Commission'';
       (2) in the second sentence, by striking ``Such rules and 
     regulations'' and inserting the following:
       ``(B) Different requirements.--Rules and regulations 
     described in subparagraph (A)'';
       (3) in the third sentence--
       (A) by striking ``No rule or regulation'' and inserting the 
     following:
       ``(C) Prohibition.--Except as provided in paragraphs (1) 
     and (2), no rule or regulation'';
       (B) by striking ``that (1) requires'' and inserting the 
     following: ``that--
       ``(i) requires''; and
       (C) by striking ``market, or (2) governs'' and inserting 
     the following: ``market; or
       ``(ii) governs''; and
       (4) by inserting before paragraph (2) (as designated by 
     paragraph (1)) the following:
       ``(1) Foreign boards of trade.--
       ``(A) In general.--It shall be unlawful for a foreign board 
     of trade to provide to the members of the foreign board of 
     trade or other participants located in the United States 
     direct access to the electronic trading and order-matching 
     system of the foreign board of trade with respect to an 
     agreement, contract, or transaction that settles against any 
     price (including the daily or final settlement price) of 1 or 
     more contracts listed for trading on a registered entity, 
     unless the Commission determines that--
       ``(i) the foreign board of trade makes public daily trading 
     information regarding the agreement, contract, or transaction 
     that is comparable to the daily trading information published 
     by the registered entity for the 1 or more contracts against 
     which the agreement, contract, or transaction traded on the 
     foreign board of trade settles; and
       ``(ii) the foreign board of trade (or the foreign futures 
     authority that oversees the foreign board of trade)--

       ``(I) adopts position limits (including related hedge 
     exemption provisions) for the agreement, contract, or 
     transaction that are comparable to the position limits 
     (including related hedge exemption provisions) adopted by the 
     registered entity for the 1 or more contracts against which 
     the agreement, contract, or transaction traded on the foreign 
     board of trade settles;
       ``(II) has the authority to require or direct market 
     participants to limit, reduce, or liquidate any position the 
     foreign board of trade (or the foreign futures authority that 
     oversees the foreign board of trade) determines to be 
     necessary to prevent or reduce the threat of price 
     manipulation, excessive speculation as described in section 
     4a, price distortion, or disruption of delivery or the cash 
     settlement process;
       ``(III) agrees to promptly notify the Commission, with 
     regard to the agreement, contract, or transaction that 
     settles against any price (including the daily or final 
     settlement price) of 1 or more contracts listed for trading 
     on a registered entity, of any change regarding--

       ``(aa) the information that the foreign board of trade will 
     make publicly available;
       ``(bb) the position limits that the foreign board of trade 
     or foreign futures authority will adopt and enforce;
       ``(cc) the position reductions required to prevent 
     manipulation, excessive speculation as described in section 
     4a, price distortion, or disruption of delivery or the cash 
     settlement process; and
       ``(dd) any other area of interest expressed by the 
     Commission to the foreign board of trade or foreign futures 
     authority;

       ``(IV) provides information to the Commission regarding 
     large trader positions in the agreement, contract, or 
     transaction that is comparable to the large trader position 
     information collected by the Commission for the 1 or more 
     contracts against which the agreement, contract, or 
     transaction traded on the foreign board of trade settles; and
       ``(V) provides the Commission such information as is 
     necessary to publish reports on aggregate trader positions 
     for the agreement, contract, or transaction traded on the 
     foreign board of trade that are comparable to such reports on 
     aggregate trader positions for the 1 or more contracts 
     against which the agreement, contract, or transaction traded 
     on the foreign board of trade settles.

       ``(B) Existing foreign boards of trade.--Subparagraph (A) 
     shall not be effective with respect to any foreign board of 
     trade to which, prior to the date of enactment of this 
     paragraph, the Commission granted direct access permission 
     until the date that is 180 days after that date of 
     enactment.''.
       (b) Liability of Registered Persons Trading on a Foreign 
     Board of Trade.--Section 4 of the Commodity Exchange Act (7 
     U.S.C. 6) is amended--
       (1) in subsection (a), in the matter preceding paragraph 
     (1), by inserting ``or by subsection (e)'' after ``Unless 
     exempted by the Commission pursuant to subsection (c)''; and
       (2) by adding at the end the following:
       ``(e) Liability of Registered Persons Trading on a Foreign 
     Board of Trade.--A person registered with the Commission, or 
     exempt from registration by the Commission, under this Act 
     may not be found to have violated subsection (a) with respect 
     to a transaction in, or in connection with, a contract of 
     sale of a commodity for future delivery if the person has 
     reason to believe that the transaction and the contract is 
     made on or subject to the rules of a foreign board of trade 
     that has complied with paragraphs (1) and (2) of subsection 
     (b).''.
       (c) Contract Enforcement for Foreign Futures Contracts.--
     Section 22(a) of the Commodity Exchange Act (7 U.S.C. 25(a)) 
     (as amended by section 736) is amended by adding at the end 
     the following:
       ``(6) Contract enforcement for foreign futures contracts.--
     A contract of sale of a commodity for future delivery traded 
     or executed on or through the facilities of a board of trade, 
     exchange, or market located outside the United States for 
     purposes of section 4(a) shall not be void, voidable, or 
     unenforceable, and a party to such a contract shall not be 
     entitled to rescind or recover any payment made with respect 
     to the contract, based on the failure of the foreign board of 
     trade to comply with any provision of this Act.''.

     SEC. 736. LEGAL CERTAINTY FOR NON-SECURITY-BASED SWAPS.

       Section 22(a) of the Commodity Exchange Act (7 U.S.C. 
     25(a)) is amended by striking paragraph (4) and inserting the 
     following:
       ``(4) Contract enforcement between eligible 
     counterparties.--
       ``(A) In general.--No hybrid instrument sold to any 
     investor shall be void, voidable, or unenforceable, and no 
     party to a hybrid instrument shall be entitled to rescind, or 
     recover any payment made with respect to, the hybrid 
     instrument under this section or any other provision of 
     Federal or State law, based solely on the failure of the 
     hybrid instrument to comply with the terms or conditions of 
     section 2(f) or regulations of the Commission.
       ``(B) Non-security-based swaps.--No agreement, contract, or 
     transaction between eligible contract participants or persons 
     reasonably believed to be eligible contract participants 
     shall be void, voidable, or unenforceable, and no party to an 
     agreement, contract, or transaction shall be entitled to 
     rescind, or recover any payment made with respect to, the 
     agreement, contract, or transaction under this section or any 
     other provision of Federal or State law, based solely on the 
     failure of the agreement, contract, or transaction--
       ``(i) to meet the definition of a non-security-based swap 
     under section 1a; or
       ``(ii) to be cleared in accordance with section 2(h)(1).
       ``(5) Legal certainty.--
       ``(A) Effect on non-security-based swaps.--Unless 
     specifically reserved in the applicable bilateral trading 
     agreement, neither the enactment of the Over-the-Counter 
     Swaps Markets Transparency and Accountability Act of 2010, 
     nor any requirement under that Act or an amendment made by 
     that Act, shall constitute a termination event, force 
     majeure, illegality, increased

[[Page S3187]]

     costs, regulatory change, or similar event under a bilateral 
     trading agreement (including any related credit support 
     arrangement) that would permit a party to terminate, 
     renegotiate, modify, amend, or supplement 1 or more 
     transactions under the bilateral trading agreement.
       ``(B) Position limits.--Any position limit established 
     under the Over-the-Counter Swaps Markets Transparency and 
     Accountability Act of 2010 shall not apply to a position 
     acquired in good faith prior to the effective date of any 
     rule, regulation, or order under the Act that establishes the 
     position limit; provided, however, that such positions shall 
     be attributed to the trader if the trader's position is 
     increased after the effective date of such position limit 
     rule, regulation, or order.''.

     SEC. 737. MULTILATERAL CLEARING ORGANIZATIONS.

       Sections 408 and 409 of the Federal Deposit Insurance 
     Corporation Improvement Act of 1991 (12 U.S.C. 4421, 4422) 
     are repealed.

     SEC. 738. ENFORCEMENT.

       (a) Conforming Amendments.--
       (1) Section 4b of the Commodity Exchange Act (7 U.S.C. 6b) 
     is amended--
       (A) in subsection (a)(2), by striking ``or other agreement, 
     contract, or transaction subject to paragraphs (1) and (2) of 
     section 5a(g),'' and inserting ``or non-security-based 
     swap,'';
       (B) in subsection (b), by striking ``or other agreement, 
     contract or transaction subject to paragraphs (1) and (2) of 
     section 5a(g),'' and inserting ``or non-security-based 
     swap,''; and
       (C) by adding at the end the following:
       ``(e) It shall be unlawful for any person, directly or 
     indirectly, by the use of any means or instrumentality of 
     interstate commerce, or of the mails, or of any facility of 
     any registered entity, in or in connection with any order to 
     make, or the making of, any contract of sale of any commodity 
     for future delivery (or option on such a contract), or any 
     non-security-based swap, on a group or index of securities 
     (or any interest therein or based on the value thereof) that 
     is a broad-based security index--
       ``(1) to employ any device, scheme, or artifice to defraud;
       ``(2) to make any untrue statement of a material fact or to 
     omit to state a material fact necessary in order to make the 
     statements made, in the light of the circumstances under 
     which they were made, not misleading; or
       ``(3) to engage in any act, practice, or course of business 
     which operates or would operate as a fraud or deceit upon any 
     person.''.
       (2) Section 4c(a)(1) of the Commodity Exchange Act (7 
     U.S.C. 6c(a)(1)) is amended by inserting ``or non-security-
     based swap'' before ``if the transaction is used or may be 
     used''.
       (3) Section 6(c) of the Commodity Exchange Act (7 U.S.C. 9) 
     is amended in the first sentence by inserting ``or of any 
     non-security-based swap,'' before ``or has willfully made''.
       (4) Section 6(d) of the Commodity Exchange Act (7 U.S.C. 
     13b) is amended in the first sentence, in the matter 
     preceding the proviso, by inserting ``or of any non-security-
     based swap,'' before ``or otherwise is violating''.
       (5) Section 6c(a) of the Commodity Exchange Act (7 U.S.C. 
     13a-1(a)) is amended in the matter preceding the proviso by 
     inserting ``or any non-security-based swap'' after 
     ``commodity for future delivery''.
       (6) Section 9 of the Commodity Exchange Act (7 U.S.C. 13) 
     is amended--
       (A) in subsection (a)--
       (i) in paragraph (2), by inserting ``or of any non-
     security-based swap,'' before ``or to corner''; and
       (ii) in paragraph (4), by inserting ``registered non-
     security-based swap data repository,'' before ``or futures 
     association'' and
       (B) in subsection (e)(1)--
       (i) by inserting ``registered non-security-based swap data 
     repository,'' before ``or registered futures association''; 
     and
       (ii) by inserting ``, or non-security-based swaps,'' before 
     ``on the basis''.
       (7) Section 9(a) of the Commodity Exchange Act (7 U.S.C. 
     13(a)) is amended by adding at the end the following:
       ``(6) Any person to abuse the end user clearing exemption 
     under section 2(h)(4), as determined by the Commission.''.
       (8) Section 8(b) of the Federal Deposit Insurance Act (12 
     U.S.C. 1818(b)) is amended by adding at the end the 
     following:
       ``(11) Swaps.--
       ``(A) In general.--Subject to subparagraph (B), this 
     section shall apply to any swap participant, derivatives 
     clearing organization, registered non-security-based swap 
     data repository, security-based swap data repository, or non-
     security-based swap execution facility regardless of whether 
     the participant, organization, repository, or facility is an 
     insured depository institution, for which the Board, the 
     Corporation, or the Office of the Comptroller of the Currency 
     is the appropriate Federal banking agency or prudential 
     regulator for purposes of the amendments made by the Over-
     the-Counter Swaps Markets Transparency and Accountability Act 
     of 2010.
       ``(B) Limitation.--The authority described in subparagraph 
     (A) shall be limited by, and exercised in accordance with, 
     section 4b-1 of the Commodity Exchange Act.''.

     SEC. 739. RETAIL COMMODITY TRANSACTIONS.

       (a) In General.--Section 2(c) of the Commodity Exchange Act 
     (7 U.S.C. 2(c)) is amended--
       (1) in paragraph (1), by striking ``(to the extent provided 
     in section 5a(g)), 5b, 5d, or 12(e)(2)(B))'' and inserting 
     ``, 5b, or 12(e)(2)(B))''; and
       (2) in paragraph (2), by adding at the end the following:
       ``(D) Retail commodity transactions.--
       ``(i) Applicability.--Except as provided in clause (ii), 
     this subparagraph shall apply to any agreement, contract, or 
     transaction in any commodity that is--

       ``(I) entered into with, or offered to (even if not entered 
     into with), a person that is not an eligible contract 
     participant or eligible commercial entity; and
       ``(II) entered into, or offered (even if not entered into), 
     on a leveraged or margined basis, or financed by the offeror, 
     the counterparty, or a person acting in concert with the 
     offeror or counterparty on a similar basis.

       ``(ii) Exceptions.--This subparagraph shall not apply to--

       ``(I) an agreement, contract, or transaction described in 
     paragraph (1) or subparagraphs (A), (B), or (C), including 
     any agreement, contract, or transaction specifically excluded 
     from subparagraph (A), (B), or (C);
       ``(II) any security;
       ``(III) a contract of sale that--

       ``(aa) results in actual delivery within 28 days or such 
     other longer period as the Commission may determine by rule 
     or regulation based upon the typical commercial practice in 
     cash or spot markets for the commodity involved; or
       ``(bb) creates an enforceable obligation to deliver between 
     a seller and a buyer that have the ability to deliver and 
     accept delivery, respectively, in connection with the line of 
     business of the seller and buyer; or

       ``(IV) an agreement, contract, or transaction that is 
     listed on a national securities exchange registered under 
     section 6(a) of the Securities Exchange Act of 1934 (15 
     U.S.C. 78f(a)).

       ``(iii) Enforcement.--Sections 4(a), 4(b), and 4b apply to 
     any agreement, contract, or transaction described in clause 
     (i), as if the agreement, contract, or transaction was a 
     contract of sale of a commodity for future delivery.
       ``(iv) Eligible commercial entity.--For purposes of this 
     subparagraph, an agricultural producer, packer, or handler 
     shall be considered to be an eligible commercial entity for 
     any agreement, contract, or transaction for a commodity in 
     connection with the line of business of the agricultural 
     producer, packer, or handler.
       ``(v) Actual delivery.--For purposes of clause (ii)(III), 
     the term `actual delivery' does not include delivery to a 
     third party in a financed transaction in which the commodity 
     is held as collateral.''.
       (b) Gramm-Leach-Bliley Act.--Section 206 of the Gramm-
     Leach-Bliley Act (Public Law 106-102; 15 U.S.C. 78c note) is 
     amended--
       (1) in subsection (a), in the matter preceding paragraph 
     (1), by striking ``For purposes of'' and inserting ``Except 
     as provided in subsection (e), for purposes of''; and
       (2) by adding at the end the following:
       ``(e) Limitation of Definition of Identified Banking 
     Product.--Except as provided in section 403 of the Legal 
     Certainty for Bank Products Act of 2000 (7 U.S.C. 27a), for 
     purposes of section 131 of the Over-the-Counter Swaps Markets 
     Transparency and Accountability Act of 2010, the term 
     `identified banking product' does not include a retail 
     commodity transaction.''.

     SEC. 740. OTHER AUTHORITY.

       Unless otherwise provided by the amendments made by this 
     subtitle, the amendments made by this subtitle do not divest 
     any appropriate Federal banking agency, the Commodity Futures 
     Trading Commission, the Securities and Exchange Commission, 
     or other Federal or State agency of any authority derived 
     from any other applicable law.

     SEC. 741. ENHANCED COMPLIANCE BY REGISTERED ENTITIES.

       (a) Core Principles for Contract Markets.--Section 5(d) of 
     the Commodity Exchange Act (7 U.S.C. 7(d)) (as amended by 
     section 732(b)) is amended by striking paragraph (1) and 
     inserting the following:
       ``(1) Designation.--
       ``(A) In general.--To be designated as, and to maintain the 
     designation of, a board of trade as a contract market, the 
     board of trade shall comply with--
       ``(i) the core principles described in this subsection; and
       ``(ii) any requirement that the Commission may impose by 
     rule or regulation pursuant to section 8a(5).
       ``(B) Discretion of board of trade.--Unless the Commission 
     determines otherwise by rule or regulation, the board of 
     trade shall have reasonable discretion in establishing the 
     manner by which the board of trade complies with each core 
     principle.''.
       (b) Core Principles.--Section 5b(c)(2) of the Commodity 
     Exchange Act (7 U.S.C. 7a-1(c)(2)) (as amended by section 
     725(c)) is amended by striking subparagraph (A) and inserting 
     the following:
       ``(A) Registration.--
       ``(i) In general.--To be registered and to maintain 
     registration as a derivatives clearing organization, a 
     derivatives clearing organization shall comply with--

       ``(I) the core principles described in this paragraph; and
       ``(II) any requirement that the Commission may impose by 
     rule or regulation pursuant to section 8a(5).

[[Page S3188]]

       ``(ii) Discretion of commission.--Unless the Commission 
     determines otherwise by rule or regulation, a derivatives 
     clearing organization shall have reasonable discretion in 
     establishing the manner by which the derivatives clearing 
     organization complies with each core principle.''.
       (c) Effect of Interpretation.--Section 5c(a) of the 
     Commodity Exchange Act (7 U.S.C. 7a-2(a)) is amended by 
     striking paragraph (2) and inserting the following:
       ``(2) Effect of interpretation.--An interpretation issued 
     under paragraph (1) may provide the exclusive means for 
     complying with each section described in paragraph (1).''.

     SEC. 742. INSIDER TRADING.

       Section 4c(a) of the Commodity Exchange Act (7 U.S.C. 
     6c(a)) is amended by adding at the end the following:
       ``(3) Contract of sale.--It shall be unlawful for any 
     employee or agent of any department or agency of the Federal 
     Government who, by virtue of the employment or position of 
     the employee or agent, acquires information that may affect 
     or tend to affect the price of any commodity in interstate 
     commerce, or for future delivery, or any non-security-based 
     swap, and which information has not been disseminated by the 
     department or agency of the Federal Government holding or 
     creating the information in a manner which makes it generally 
     available to the trading public, or disclosed in a criminal, 
     civil, or administrative hearing, or in a congressional, 
     administrative, or Government Accountability Office report, 
     hearing, audit, or investigation, to use the information in 
     his personal capacity and for personal gain to enter into, or 
     offer to enter into--
       ``(A) a contract of sale of a commodity for future delivery 
     (or option on such a contract);
       ``(B) an option (other than an option executed or traded on 
     a national securities exchange registered pursuant to section 
     6(a) of the Securities Exchange Act of 1934 (15 U.S.C. 
     78f(a)); or
       ``(C) a non-security-based swap.
       ``(4) Imparting of nonpublic information.--
       ``(A) Imparting of nonpublic information.--It shall be 
     unlawful for any employee or agent of any department or 
     agency of the Federal Government who, by virtue of the 
     employment or position of the employee or agent, acquires 
     information that may affect or tend to affect the price of 
     any commodity in interstate commerce, or for future delivery, 
     or any swap, and which information has not been disseminated 
     by the department or agency of the Federal Government holding 
     or creating the information in a manner which makes it 
     generally available to the trading public, or disclosed in a 
     criminal, civil, or administrative hearing, or in a 
     congressional, administrative, or Government Accountability 
     Office report, hearing, audit, or investigation, to impart 
     the information in his personal capacity and for personal 
     gain with intent to assist another person, directly or 
     indirectly, to use the information to enter into, or offer to 
     enter into--
       ``(i) a contract of sale of a commodity for future delivery 
     (or option on such a contract);
       ``(ii) an option (other than an option executed or traded 
     on a national securities exchange registered pursuant to 
     section 6(a) of the Securities Exchange Act of 1934 (15 
     U.S.C. 78f(a)); or
       ``(iii) a non-security-based swap; and
       ``(B) Knowing use.--It shall be unlawful for any person who 
     receives information imparted by any employee or agent of any 
     department or agency of the Federal Government as described 
     in subparagraph (A) to knowingly use such information to 
     enter into, or offer to enter into--
       ``(i) a contract of sale of a commodity for future delivery 
     (or option on such a contract);
       ``(ii) an option (other than an option executed or traded 
     on a national securities exchange registered pursuant to 
     section 6(a) of the Securities Exchange Act of 1934 (15 
     U.S.C. 78f(a)); or
       ``(iii) a non-security-based swap; and
       ``(C) Theft of nonpublic information.--It shall be unlawful 
     for any person knowingly to steal, convert, or misappropriate 
     acquire, by any means whatsoever, governmental information 
     held or created by any department or agency of the Federal 
     Government that may affect or tend to affect the price of any 
     commodity in interstate commerce, or for future delivery, or 
     any non-security-based swap, where such person knows, or in 
     the exercise of reasonable care should know acts in reckless 
     disregard of the fact, that such information has not been 
     disseminated by the department or agency of the Federal 
     Government holding or creating the information in a manner 
     which makes it generally available to the trading public, or 
     disclosed in a criminal, civil, or administrative hearing, or 
     in a congressional, administrative, or Government 
     Accountability Office report, hearing, audit, or 
     investigation, and to use such information, or to impart such 
     information with the intent to assist another person, 
     directly or indirectly, to use such information to enter 
     into, or offer to enter into--
       ``(i) a contract of sale of a commodity for future delivery 
     (or option on such a contract);
       ``(ii) an option (other than an option executed or traded 
     on a national securities exchange registered pursuant to 
     section 6(a) of the Securities Exchange Act of 1934 (15 
     U.S.C. 78f(a)); or
       ``(iii) a non-security-based swap.

     Provided, however, that nothing in this subparagraph shall 
     preclude a person that has provided information concerning, 
     or generated by, the person, its operations or activities, to 
     any employee or agent of any department or agency of the 
     Federal Government, voluntarily or as required by law, from 
     using such information to enter into, or offer to enter into, 
     a contract of sale, option, or non-security-based swap 
     described in clauses (i), (ii), or (iii).''.

     SEC. 743. CONFORMING AMENDMENTS.

       (a) Section 2(c)(1) of the Commodity Exchange Act (7 U.S.C. 
     2(c)(1)) is amended, in the matter preceding subparagraph 
     (A), by striking ``5a (to the extent provided in section 
     5a(g)),''.
       (b) Section 4d of the Commodity Exchange Act (7 U.S.C. 6d) 
     (as amended by section 724) is amended--
       (1) in subsection (a)--
       (A) in the matter preceding paragraph (1)--
       (i) by striking ``engage as'' and inserting ``be a''; and
       (ii) by striking ``or introducing broker'' and all that 
     follows through ``or derivatives transaction execution 
     facility'';
       (B) in paragraph (1), by striking ``or introducing 
     broker''; and
       (C) in paragraph (2), by striking ``if a futures commission 
     merchant,''; and
       (2) by adding at the end the following:
       ``(g) It shall be unlawful for any person to be an 
     introducing broker unless such person shall have registered 
     under this Act with the Commission as an introducing broker 
     and such registration shall not have expired nor been 
     suspended nor revoked.''.
       (c) Section 5c of the Commodity Exchange Act (7 U.S.C. 7a-
     2) is amended--
       (1) in subsection (a)(1)--
       (A) by striking ``, 5a(d),''; and
       (B) by striking ``and section (2)(h)(7) with respect to 
     significant price discovery contracts,''; and
       (2) in subsection (f)(1), by striking ``section 4d(c) of 
     this Act'' and inserting ``section 4d(e)''.
       (d) Section 5e of the Commodity Exchange Act (7 U.S.C. 7b) 
     is amended by striking ``or revocation of the right of an 
     electronic trading facility to rely on the exemption set 
     forth in section 2(h)(3) with respect to a significant price 
     discovery contract,''.
       (e) Section 6(b) of the Commodity Exchange Act (7 U.S.C. 
     8(b)) is amended in the first sentence by striking ``, or to 
     revoke the right of an electronic trading facility to rely on 
     the exemption set forth in section 2(h)(3) with respect to a 
     significant price discovery contract,''.
       (f) Section 12(e)(2)(B) of the Commodity Exchange Act (7 
     U.S.C. 16(e)(2)(B)) is amended--
       (1) by striking ``section 2(c), 2(d), 2(f), or 2(g) of this 
     Act'' and inserting ``section 2(c), 2(f), or 2(i) of this 
     Act''; and
       (2) by striking ``2(h) or''.
       (g) Section 17(r)(1) of the Commodity Exchange Act (7 
     U.S.C. 21(r)(1)) is amended by striking ``section 4d(c) of 
     this Act'' and inserting ``section 4d(e)''.
       (h) Section 22(b)(1)(A) of the Commodity Exchange Act (7 
     U.S.C. 25(b)(1)(A)) is amended by striking ``section 2(h)(7) 
     or''.
       (i) Section 408(2)(C) of the Federal Deposit Insurance 
     Corporation Improvement Act of 1991 (12 U.S.C. 4421(2)(C)) is 
     amended--
       (1) by striking ``section 2(c), 2(d), 2(f), or (2)(g) of 
     such Act'' and inserting ``section 2(c), 2(f), or 2(i) of 
     that Act''; and
       (2) by striking ``2(h) or''.

         Subtitle C--Regulation of Security-Based Swap Markets

     SEC. 761. DEFINITIONS UNDER THE SECURITIES EXCHANGE ACT OF 
                   1934.

       (a) Definitions.--Section 3(a) of the Securities Exchange 
     Act of 1934 (15 U.S.C. 78c(a)) is amended--
       (1) in paragraph (13), by adding at the end the following: 
     ``For security-based swaps, such terms include the execution, 
     termination (prior to its scheduled maturity date), 
     assignment, exchange, or similar transfer or conveyance of, 
     or extinguishing of rights or obligations under, a security-
     based swap, as the context may require.'';
       (2) in paragraph (14), by adding at the end the following: 
     ``For security-based swaps, such terms include the execution, 
     termination (prior to its scheduled maturity date), 
     assignment, exchange, or similar transfer or conveyance of, 
     or extinguishing of rights or obligations under, a security-
     based swap, as the context may require.'';
       (3) in paragraph (39)--
       (A) in subparagraph (B)(i)(I), by striking ``or government 
     securities dealer'' and inserting ``government securities 
     dealer, or swap participant'';
       (B) in subparagraph (B)(i)(II), by inserting ``swap 
     participant,'' after ``government securities dealer,'';
       (C) in subparagraph (C), by striking ``or government 
     securities dealer'' and inserting ``government securities 
     dealer, or swap participant''; and
       (D) in subparagraph (D), by inserting ``swap participant,'' 
     after ``government securities dealer,''; and
       (4) by adding at the end the following:
       ``(65) Eligible contract participant.--The term `eligible 
     contract participant' has the same meaning as in section 1a 
     of the Commodity Exchange Act (7 U.S.C. 1a).
       ``(66) Swap participant.--The term `swap participant' has 
     the same meaning as in section 1a of the Commodity Exchange 
     Act (7 U.S.C. 1a).

[[Page S3189]]

       ``(67) Security-based swap.--The term `security-based swap' 
     means--
       ``(A) an instrument that is not a security; and
       ``(B) a swap, of which 1 or more material terms--
       ``(i) is based on the price, yield, value, or volatility 
     of--

       ``(I) any single security, any narrow-based group or 
     narrow-based index of securities, or any interest therein; or
       ``(II) any single loan, any narrow-based group or narrow-
     based index of loans, or any interest therein;

       ``(ii) is dependent on the occurrence, non-occurrence, or 
     the extent of the occurrence of an event or contingency 
     associated with a potential financial, economic, or 
     commercial consequence that is related to or based on--

       ``(I) a single security, an interest in a security, an 
     issuer of a security, or narrow-based group or narrow-based 
     index of securities, or interests in securities or issuers of 
     securities; or
       ``(II) a single loan, an interest in a loan, a recipient of 
     a loan, or narrow-based group or narrow-based index of loans, 
     or interests in loans or recipients of loans;

       ``(iii) provides for the purchase or sale of no more than 9 
     securities or loans on a contingent basis, whether physically 
     or cash settled, if such agreement, contract, or transaction 
     predicates such purchase or sale (or a net cash payment in 
     lieu thereof) on the occurrence of a bona fide contingency 
     that might reasonably be expected to affect or be affected by 
     the creditworthiness of 1 or more reference entities; or
       ``(iv) allows for payment, settlement, termination, 
     fulfillment, or extinguishment of the swap or delivery on the 
     swap, by means of the transfer or receipt of no more than 9 
     securities or loans, including any narrow-based group or 
     narrow-based index of securities or loans.
       ``(68) Cleared swap.--The term `cleared swap' means any 
     swap that is, directly or indirectly, submitted to and 
     cleared by a derivatives clearing organization registered 
     with the Commodity Futures Trading Commission or a clearing 
     agency registered with the Commission.
       ``(69) Swap.--The term `swap' has the same meaning as in 
     section 1a of the Commodity Exchange Act (7 U.S.C. 1a).
       ``(70) Associated person of a swap participant.--
       ``(A) In general.--The term `associated person of a swap 
     participant' means--
       ``(i) any partner, officer, director, or branch manager of 
     a swap participant (including any individual who holds a 
     similar status or performs a similar function with respect to 
     any partner, officer, director, or branch manager of a swap 
     participant);
       ``(ii) any person that directly or indirectly controls, is 
     controlled by, or is under common control with, a swap 
     participant; and
       ``(iii) any employee of a swap participant.
       ``(B) Exclusion.--The term `associated person of a swap 
     participant' does not include any person associated with a 
     swap participant the functions of which are solely clerical 
     or ministerial.
       ``(71) Appropriate federal banking agency.--The term 
     `appropriate Federal banking agency' has the same meaning as 
     in section 3(q) of the Federal Deposit Insurance Act (12 
     U.S.C. 1813(q)).
       ``(72) Board.--The term `Board' means the Board of 
     Governors of the Federal Reserve System.
       ``(73) Prudential regulator.--The term `prudential 
     regulator' has the same meaning as in section 1a of the 
     Commodity Exchange Act (7 U.S.C. 1a).
       ``(74) Security-based swap data repository.--The term 
     `security-based swap data repository' means any person that 
     collects, calculates, prepares, or maintains information or 
     records with respect to transactions or positions in, or the 
     terms and conditions of, security-based swaps entered into by 
     third parties.
       ``(75) Swap end user.--The term `swap end user' has the 
     same meaning as in section 1a of the Commodity Exchange Act 
     (7 U.S.C. 1a).
       ``(76) Broad-based security index.--The term `broad-based 
     security index' has the same meaning as in section 1a of the 
     Commodity Exchange Act (7 U.S.C. la).''.
       (b) Definitions Under the Securities Act of 1933.--Section 
     2(a) of the Securities Act of 1933 (15 U.S.C. 77b(a)) is 
     amended--
       (1) in paragraph (3), by adding at the end the following: 
     ``Any offer or sale of a security-based swap by or on behalf 
     of the issuer of the securities upon which such security-
     based swap is based or which it references, an affiliate of 
     the issuer, or an underwriter, shall constitute a contract 
     for sale of, sale of, offer for sale, or offer to sell such 
     securities.''; and
       (2) by adding at the end the following:
       ``(17) The terms `security-based swap', and `swap', have 
     the same meanings as in paragraphs (67) and (69), 
     respectively, of section 3(a) of the Securities Exchange Act 
     of 1934.
       ``(18) The terms `purchase' or `sale' of a security-based 
     swap, shall be deemed to mean the execution, termination 
     (prior to its scheduled maturity date), assignment, exchange, 
     novation, or similar transfer or conveyance of, or 
     extinguishment (prior to its scheduled extinguishment date) 
     of material rights or obligations under, a security-based 
     swap, as the context may require.''.

     SEC. 762. REPEAL OF PROHIBITION ON REGULATION OF SWAPS.

       (a) Repeal of Law.--The following provisions of law are 
     repealed:
       (1) Sections 206A, 206B, and 206C of the Gramm-Leach-Bliley 
     Act (15 U.S.C. 78c note).
       (2) Section 2A of the Securities Act of 1933 (15 U.S.C. 
     77b-1).
       (3) Section 17(d) of the Securities Act of 1933 (15 U.S.C. 
     77q(d)).
       (4) Section 3A of the Securities Exchange Act of 1934 (15 
     U.S.C. 78c-1).
       (5) Section 9(i) of the Securities Exchange Act of 1934 (15 
     U.S.C. 78i(i)).
       (6) Section 15(i) of the Securities Exchange Act of 1934 
     (15 U.S.C. 78o(i)), as added by section 303(f) of the 
     Commodity Futures Modernization Act of 2000 (Public Law 106-
     554; 114 Stat. 2763A-455).
       (7) Section 16(g) of the Securities Exchange Act of 1934 
     (15 U.S.C. 78p(g)).
       (8) Section 20(f) of the Securities Exchange Act of 1934 
     (15 U.S.C. 78t(f)).
       (9) Section 21A(g) of the Securities Exchange Act of 1934 
     (15 U.S.C. 78u-1(g)).
       (b) Conforming Amendment to the Securities Act of 1933.--
     Section 17(a) of the Securities Act of 1933 (15 U.S.C. 
     77q(a)) is amended by striking ``agreement (as defined in 
     section 206B of the Gramm-Leach-Bliley Act)'' and inserting 
     ``(as defined in section 3(a)(67) of the Securities Exchange 
     Act of 1934 (15 U.S.C. 78c(a)(67))''.
       (c) Conforming and Other Amendments to the Securities 
     Exchange Act of 1934.--The Securities Exchange Act of 1934 
     (15 U.S.C. 78a et seq.) is amended--
       (1) in section 9(a) (15 U.S.C. 78i(a)), by striking 
     paragraphs (2) through (5) and inserting the following:
       ``(2) To effect, alone or with 1 or more other persons, a 
     series of transactions in any security registered on a 
     national securities exchange, any security not so registered, 
     or in connection with any swap with respect to such security 
     creating actual or apparent active trading in such security, 
     or raising or depressing the price of such security, for the 
     purpose of inducing the purchase or sale of such security by 
     others.
       ``(3) If a dealer or broker, or other person selling or 
     offering for sale or purchasing or offering to purchase the 
     security to induce the purchase or sale of any security 
     registered on a national securities exchange, any security 
     not so registered, or any swap with respect to such security 
     by the circulation or dissemination in the ordinary course of 
     business of information to the effect that the price of any 
     such security will or is likely to rise or fall because of 
     market operations of any 1 or more persons conducted for the 
     purpose of raising or depressing the price of such security.
       ``(4) If a dealer or broker, or the person selling or 
     offering for sale or purchasing or offering to purchase the 
     security, to make, regarding any security registered on a 
     national securities exchange, any security not so registered, 
     or any swap with respect to such security, for the purpose of 
     inducing the purchase or sale of such security or such swap, 
     any statement which was at the time and in the light of the 
     circumstances under which it was made, false or misleading 
     with respect to any material fact, and which he knew or had 
     reasonable ground to believe was so false or misleading.
       ``(5) For a consideration, received directly or indirectly 
     from a dealer or broker, or other person selling or offering 
     for sale or purchasing or offering to purchase the security, 
     to induce the purchase of any security registered on a 
     national securities exchange, any security not so registered, 
     or any swap with respect to such security by the circulation 
     or dissemination of information to the effect that the price 
     of any such security will or is likely to rise or fall 
     because of the market operations of any 1 or more persons 
     conducted for the purpose of raising or depressing the price 
     of such security.'';
       (2) in section 10 (15 U.S.C. 78j)--
       (A) by striking ``agreement (as defined in section 206B of 
     the Gramm-Leach-Bliley Act)''; and
       (B) by striking ``agreements (as defined in section 206B of 
     the Gramm-Leach-Bliley Act)'' each place that term appears;
       (3) in section 15(c) (15 U.S.C. 78o(c)), by striking 
     ``agreement (as defined in section 206B of the Gramm-Leach-
     Bliley Act)'' each place that term appears;
       (4) in section 16 (15 U.S.C. 78p)--
       (A) in subsection (a)(2)(C), by striking ``agreement (as 
     defined in section 206(b) of the Gramm-Leach-Bliley Act)'';
       (B) in subsection (a)(3)(B), by striking ``agreement (as 
     defined in section 206B of the Gramm-Leach-Bliley Act)''; and
       (C) in subsection (b), by striking ``agreement (as defined 
     in section 206B of the Gramm-Leach-Bliley Act)'' each place 
     that the term appears;
       (5) in section 20(d) (15 U.S.C. 78t(d)), by striking 
     ``agreement (as defined in section 206B of the Gramm-Leach-
     Bliley Act)''; and
       (6) in section 21A(a)(1) (15 U.S.C. 78u-1), by striking 
     ``agreement (as defined in section 206B of the Gramm-Leach-
     Bliley Act)''.

     SEC. 763. CLEARING.

       (a) Registered Clearing Agencies.--Section 17A(b)(3) of the 
     Securities Exchange Act of 1934 (15 U.S.C. 78q-1) is amended 
     by adding at the end the following:
       ``(J) The Commission shall require clearing agencies to 
     provide information collected related to the clearing of 
     security-based swaps by such agencies to any of the following 
     regulatory authorities that requests such information:
       ``(i) The Board.
       ``(ii) The Commodity Futures Trading Commission.
       ``(iii) Each appropriate prudential regulator.

[[Page S3190]]

       ``(iv) The Financial Stability Oversight Council.
       ``(v) The Department of Justice.
       ``(vi) Any other person that the Commission determines to 
     be appropriate, including--

       ``(I) foreign financial supervisors (including foreign 
     futures authorities);
       ``(II) foreign central banks; and
       ``(III) foreign ministries.

       ``(K) A person that is required to be registered as a 
     clearing agency under this section shall register with the 
     Commission regardless of whether the person is also licensed 
     as a bank or a derivatives clearing organization registered 
     with the Commodity Futures Trading Commission under the 
     Commodity Exchange Act (7 U.S.C. 7a-1).''.
       (b) Required Clearing.--The Securities Exchange Act of 1934 
     (15 U.S.C. 78a et seq.) is amended by inserting after section 
     17C, as added by this subtitle, the following:

     ``SEC. 17D. CLEARING OF SECURITY-BASED SWAP TRANSACTIONS.

       ``(a) Clearing Requirement.--
       ``(1) Swaps subject to mandatory clearing requirement.--In 
     accordance with paragraph (2), the Commission shall, jointly 
     with the Commodity Futures Trading Commission and the Board, 
     adopt rules to establish criteria for determining that a 
     swap, or any group, category, type, or class of swap is 
     required to be cleared.
       ``(2) Factors.--In carrying out paragraph (1), the 
     following factors shall be considered--
       ``(A) whether 1 or more derivatives clearing organizations 
     or clearing agencies accepts the swap or the group, category, 
     type, or class of swap for clearing;
       ``(B) whether the swap or the group, category, type, or 
     class of swap is traded pursuant to standard documentation 
     and terms;
       ``(C) the liquidity of the swap or the group, category, 
     type, or class of swap and its underlying commodity, 
     security, security of a reference entity, or group or index 
     thereof;
       ``(D) the ability to value the swap or the group, category, 
     type, or class of swap and its underlying commodity, 
     security, security of a reference entity, or group or index 
     thereof consistent with an accepted pricing methodology, 
     including the availability of intraday prices;
       ``(E) the size of the market for the swap or the group, 
     category, type, or class of swap and the available capacity, 
     operational expertise, and resources of the derivatives 
     clearing organization or clearing agency that accepts it for 
     clearing;
       ``(F) whether a clearing mandate would mitigate risk to the 
     financial system or whether such a mandate would unduly 
     concentrate risk in a clearing participant, derivatives 
     clearing organization, or clearing agency in a manner that 
     could threaten the solvency of that clearing participant, the 
     derivatives clearing organization, or the clearing agency; 
     and
       ``(G) such other factors as the Commission, the Commodity 
     Futures Trading Commission, and the Board may jointly 
     determine are relevant.
       ``(3) Security-based swaps subject to clearing 
     requirement.--The Commission--
       ``(A) shall review each security-based swap, or any group, 
     category, type, or class of security-based swap that is 
     currently listed for clearing and those which a clearing 
     agency notifies the Commission that the clearing agency plans 
     to list for clearing after the date of enactment of this 
     subsection;
       ``(B) may require, pursuant to the rules adopted under 
     paragraph (1) and through notice-and-comment rulemaking, that 
     a particular security-based swap or any group, category, 
     type, or class of security-based swap must be cleared if--
       ``(i) both counterparties are swap participants;
       ``(ii) the transaction was entered into on or before the 
     later of--

       ``(I) the date of publication of the requirement in the 
     Federal Register; or
       ``(II) the effective date of the requirement; and

       ``(iii) one of the counterparties directly or indirectly 
     controls, is controlled by, or is under common control with 
     the other counterparty to the transaction, provided, however, 
     that the Commission, jointly with the Financial Stability 
     Oversight Council, may determine, by rule or order, that 
     transactions between certain parties under common control are 
     subject to any requirement to clear under this clause; and
       ``(C) shall rely on economic analysis provided by 
     economists of the Commission in making any determination 
     under subparagraph (B), which economic analysis may refer to 
     any peer-reviewed or other relevant literature conducted by 
     independent researchers.
       ``(4) Effect.--
       ``(A) Nothing in this subsection affects the ability of a 
     clearing agency to list for permissive clearing any security-
     based swap, or group, category, type, or class of security-
     based swap.
       ``(B) The Commission shall not compel a clearing agency to 
     list a security-based swap or any group, category, type, or 
     class of security-based swap for clearing if the clearing 
     agency determines that the security-based swap or the group, 
     category, type, or class of security-based swap would--
       ``(i) adversely impact the business operations of the 
     clearing agency;
       ``(ii) impair the financial integrity of the clearing 
     agency; or
       ``(iii) pose a threat to the financial stability of the 
     United States.
       ``(5) Prevention of evasion.--
       ``(A) In general.--The Commission may prescribe rules, or 
     issue interpretations of such rules, as necessary to prevent 
     evasions of any requirement to clear under paragraph (3).
       ``(B) Considerations.--In issuing rules or interpretations 
     under subparagraph (A), the Commission shall consider--
       ``(i) the extent to which the terms of the security-based 
     swap or any group, category, type, or class of security-based 
     swap are similar to the terms of other security-based swaps 
     or other groups, categories, types, or classes of security-
     based swaps that are required to be cleared by swap 
     participants under paragraph (3); and
       ``(ii) whether there is an economic purpose for any 
     differences in the terms of the security-based swap or group, 
     category, type, or class of security-based swap that are 
     required to be cleared by swap participants under paragraph 
     (3).
       ``(6) Elimination of requirement to clear.--The Commission 
     may, pursuant to the rules adopted under paragraph (1) and 
     through notice-and-comment rulemaking, rescind a requirement 
     imposed under paragraph (3) with respect to a security-based 
     swap or any group, category, type, or class of security-based 
     swap.
       ``(7) Petition for rulemaking.--Any person may file a 
     petition, pursuant to the rules of practice of the 
     Commission, requesting that the Commission--
       ``(A) use the authority granted to the Commission under 
     paragraph (3) to require swap participants to clear a 
     particular security-based swap or any group, category, type, 
     or class of security-based swap; or
       ``(B) use the authority granted to the Commission under 
     paragraph (6) to rescind a requirement for swap participants 
     to clear a particular security-based swap or any group, 
     category, type, or class of security-based swap.
       ``(8) Option to clear for counterparties that are not swap 
     participants.--Before entering into a security-based swap 
     transaction, any counterparty that is not a swap participant 
     may elect to clear a security-based swap that is subject to a 
     clearing requirement under paragraph (3). If such 
     counterparty elects to clear, it shall have the sole right to 
     select the derivatives clearing organization or clearing 
     agency at which the security-based swap will be cleared.
       ``(b) Segregation Requirements for Cleared Security-Based 
     Swaps.--
       ``(1) In general.--
       ``(A) Segregation required.--A swap participant shall treat 
     and deal with all money, securities, and property of any swap 
     customer received to margin, guarantee, or secure a security-
     based swap cleared by or through a clearing agency (including 
     money, securities, or property accruing to the swap customer 
     as the result of such a swap) as belonging to the swap 
     customer.
       ``(B) Commingling prohibited.--Money, securities, and 
     property of a swap customer described in subparagraph (A)--
       ``(i) shall be separately accounted for; and
       ``(ii) shall not be--

       ``(I) commingled with the funds of the swap participant; or
       ``(II) used to margin, secure, or guarantee any trades or 
     contracts of any swap customer or person other than the 
     person for whom the same are held.

       ``(2) Exceptions.--
       ``(A) Use of funds.--
       ``(i) In general.--Notwithstanding paragraph (1), money, 
     securities, and property of a swap customer of a swap 
     participant described in paragraph (1) may, for convenience, 
     be commingled and deposited in the same 1 or more accounts 
     with any bank or trust company or with a clearing agency.
       ``(ii) Withdrawal.--Notwithstanding paragraph (1), such 
     share of the money, securities, and property described in 
     clause (i) as in the normal course of business shall be 
     necessary to margin, guarantee, secure, transfer, adjust, or 
     settle a cleared swap with a clearing agency, or with any 
     member of the clearing agency, may be withdrawn and applied 
     to such purposes, including the payment of commissions, 
     brokerage, interest, taxes, storage, and other charges, 
     lawfully accruing in connection with the cleared swap.
       ``(B) Commission action.--Notwithstanding paragraph (1), in 
     accordance with such terms and conditions as the Commission 
     may prescribe by rule, regulation, or order, any money, 
     securities, or property of the swap customer of a swap 
     participant described in paragraph (1) may be commingled and 
     deposited as provided in this subsection with any other 
     money, securities, or property received by the swap 
     participant and required by the Commission to be separately 
     accounted for and treated and dealt with as belonging to the 
     swap customer.
       ``(3) Permitted investments.--Money described in paragraph 
     (1) may be invested in obligations of the United States or in 
     any other investment that has minimal credit, market, and 
     liquidity risks that the Commission may by rule or regulation 
     prescribe, and such investments shall be made in accordance 
     with such rules and regulations and subject to such 
     conditions as the Commission may prescribe.
       ``(4) Prohibition.--It shall be unlawful for any person, 
     including any clearing agency and any depository institution, 
     that has received any money, securities, or property for 
     deposit in a separate account or accounts as provided in 
     paragraph (1) to hold, dispose of,

[[Page S3191]]

     or use any such money, securities, or property as belonging 
     to the depositing swap participant or any person other than 
     the swap customer of the swap participant.''.

     SEC. 764. TRANSPARENCY OF SECURITY-BASED SWAP TRANSACTION 
                   DATA.

       (a) Purposes.--The Securities and Exchange Commission is 
     directed, consistent with the purposes of this subtitle, to 
     use the authorities granted to it under this title, and the 
     amendments made by this subtitle, to facilitate the prompt 
     and accurate collection, calculation, processing or 
     preparation, and public dissemination of information on 
     transactions and positions in security-based swaps.
       (b) National Trade Reporting of Security-Based Swap 
     Transactions.--The Securities Exchange Act of 1934 is amended 
     by inserting after section 17B (15 U.S.C. 78q-2) the 
     following:

     ``SEC. 17C. NATIONAL TRADE REPORTING OF SECURITY-BASED SWAP 
                   TRANSACTIONS.

       ``(a) Mandatory Reporting of Security-Based Swap 
     Transactions.--
       ``(1) In general.--
       ``(A) Transactions in security-based swaps.--Any person 
     that enters into or effects a transaction in a security-based 
     swap shall report such transaction through a clearing agency 
     or a security-based swap data repository registered with the 
     Commission within the period specified by any rule or 
     regulation adopted by the Commission under this paragraph.
       ``(B) Uncleared security-based swaps.--If no registered 
     security-based swap data repository accepts an uncleared 
     security-based swap, the person shall report the transaction 
     to the Commission pursuant to the requirements that the 
     Commission may by rule or regulation prescribe.
       ``(C) Mandatory disclosures.--Each transaction report 
     required under subparagraph (A) shall disclose whether the 
     transaction is a bona fide hedging swap transaction, as that 
     term is defined in section 1a of the Commodity Exchange Act 
     (7 U.S.C. 1a), and any other information that the Commission 
     has, by rule or regulation, prescribed as necessary or 
     appropriate in furtherance of the purposes of this section.
       ``(2) Permissible reporting for a counterparty that is not 
     a security-based swap participant.--A swap participant may 
     report a transaction in accordance with this section on 
     behalf of its counterparty to that transaction provided that 
     counterparty is not a swap participant.
       ``(3) Rulemaking required.--Not later than 180 days after 
     the date of enactment of this section, the Commission shall 
     by rule or regulation establish a schedule for the reporting 
     through a clearing agency or registered security-based swap 
     data repository or to the Commission of each security-based 
     swap transaction or group, category, type, or class of 
     security-based swap transactions entered into--
       ``(A) before the effective date of the Commission's rule or 
     regulation and still outstanding as of such effective date; 
     and
       ``(B) on or after the effective date of the Commission's 
     rule or regulation.
       ``(b) Confidentiality of Information Provided.--No non-
     public information provided to or obtained by the Commission 
     under this section may be disclosed to any other person. 
     Nothing in this subsection shall authorize the Commission to 
     withhold information from Congress, or prevent the Commission 
     from complying with a request for information from any other 
     Federal department or agency or foreign government with which 
     the Commission has an information sharing arrangement that 
     requests the information for purposes within the scope of its 
     jurisdiction, or complying with an order of a court of the 
     United States in an action brought by the United States or 
     the Commission.
       ``(c) Public Dissemination of Certain Information 
     Provided.--
       ``(1) In general.--
       ``(A) Prices and volumes.--Notwithstanding subsection (b), 
     the Commission is directed to use the authority granted to 
     the Commission under this title to facilitate the public 
     dissemination of prices and volumes of completed security-
     based swap transactions to provide investors and other market 
     participants with information about recently executed 
     transactions for the purposes of helping such investors and 
     participants to--
       ``(i) mark existing security-based swap positions to 
     market;
       ``(ii) make informed decisions before executing future 
     transactions; and
       ``(iii) assess the quality of transactions that such 
     investors and participants have executed.
       ``(B) Rulemaking.--For each security-based swap or group, 
     category, type, or class of security-based swap, the 
     Commission shall determine by rule the extent to which 
     individual or aggregated transaction data shall be 
     disseminated and the timeliness of such disseminations.
       ``(2) Reliance on economic analysis.--
       ``(A) In general.--In making determinations under this 
     subsection, the Commission shall rely on economic analyses 
     provided by the Chief Economist of the Commission and 
     independent researchers that empirically evaluate the effects 
     of increasing price transparency on measures of efficiency, 
     competition, and market quality, including transaction costs 
     and liquidity.
       ``(B) Pilot programs.--To facilitate the empirical analyses 
     under subparagraph (A), the Commission may design pilot 
     programs that increase price transparency on selected 
     security-based swaps.
       ``(3) Chief economist report.--
       ``(A) In general.--Whenever the Commission publishes a 
     release giving notice of a proposed rulemaking under this 
     subsection, and affords interested persons an opportunity to 
     comment on such proposed rulemaking or publishes a release 
     adopting a final rule, such release shall include as a part 
     thereof a report by the Chief Economist of the Commission.
       ``(B) Required inclusions.--Each report required under 
     subparagraph (A) shall--
       ``(i) describe the economic analysis of the expected 
     consequences of the proposed or final Commission action;
       ``(ii) refer to any peer-reviewed or other literature, 
     including any empirical study undertaken by the staff of the 
     Commission, that is relevant to the analysis contained in the 
     report; and
       ``(iii) describe the extent to which the conclusions of the 
     report remain subject to uncertainty.
       ``(4) Protection of proprietary information.--
       ``(A) Considerations.--In making determinations under this 
     subsection, the Commission shall consider whether public 
     dissemination of individual or aggregate transaction data 
     could result in the dissemination of proprietary information 
     about the swap transactions, positions, trading strategies, 
     or the ability of particular market participants to conduct 
     effective hedging or risk management.
       ``(B) Required rules.--Any rules adopted by the Commission 
     under this subsection shall include protections to ensure 
     that the public dissemination of security-based swap 
     transaction data does not result in the disclosure of the 
     proprietary information described in subparagraph (A).
       ``(5) Registered entities and public reporting.--The 
     Commission may require clearing agencies and registered 
     security-based swap data repositories to publicly disseminate 
     the security-based swap transaction and pricing data required 
     to be reported under this subsection.
       ``(6) Quarterly public reporting of aggregate security-
     based swap data.--
       ``(A) In general.--In accordance with subparagraph (B), the 
     Commission shall issue a written report on a quarterly basis 
     to make available to the public information relating to--
       ``(i) the trading and clearing in the major security-based 
     swap categories; and
       ``(ii) the market participants and developments in new 
     products.
       ``(B) Use; consultation.--In preparing a report under 
     subparagraph (A), the Commission shall--
       ``(i) use any information reported directly to the 
     Commission and information from registered security-based 
     swap data repositories and clearing agencies; and
       ``(ii) consult with the Office of the Comptroller of the 
     Currency, the Bank for International Settlements, and such 
     other regulatory bodies as may be necessary.
       ``(d) Registration.--
       ``(1) In general.--A security-based swap data repository 
     may register by filing with the Commission an application in 
     such form as the Commission, by rule or regulation, shall 
     prescribe containing such information as the Commission, by 
     rule or regulation, may prescribe as necessary or appropriate 
     in furtherance of the purposes of this section.
       ``(2) Inspection and examination.--Each registered 
     security-based swap data repository shall be subject to 
     inspection and examination by any representative of the 
     Commission.
       ``(3) Sharing of information.--The Commission shall require 
     each registered security-based swap data repository to 
     provide information collected related to its functions as a 
     security-based swap data repository to any of the following 
     regulatory authorities that requests such information:
       ``(A) The Board.
       ``(B) The Commodity Futures Trading Commission.
       ``(C) Each appropriate prudential regulator.
       ``(D) The Financial Stability Oversight Council.
       ``(E) The Department of Justice.
       ``(F) Any other person that the Commission determines to be 
     appropriate, including--
       ``(i) foreign financial supervisors (including foreign 
     futures authorities);
       ``(ii) foreign central banks; and
       ``(iii) foreign ministries.
       ``(e) Standard Setting.--
       ``(1) Data identification.--The Commission shall prescribe 
     standards that specify the data elements for each security-
     based swap, including whether the transaction is a bona fide 
     hedging swap transaction as defined in section 1a of the 
     Commodity Exchange Act (7 U.S.C. la), that shall be collected 
     and maintained by each registered security-based swap data 
     repository.
       ``(2) Data collection and maintenance.--The Commission 
     shall prescribe data collection and data maintenance 
     standards for security-based swap data repositories.
       ``(3) Comparability.--The standards prescribed by the 
     Commission under this subsection shall be comparable to the 
     data standards imposed by the Commission on clearing agencies 
     in connection with such agencies' clearing of security-based 
     swaps.
       ``(f) Duties.--A registered security-based swap data 
     repository shall--

[[Page S3192]]

       ``(1) accept data prescribed by the Commission for 1 or 
     more security-based swap under subsection (b);
       ``(2) confirm with both counterparties to the security-
     based swap the accuracy of the data that was submitted;
       ``(3) maintain the data described in paragraph (1) in such 
     form, in such manner, and for such period as may be required 
     by the Commission;
       ``(4)(A) provide direct electronic access to the Commission 
     (or any designee of the Commission, including another 
     registered entity); and
       ``(B) provide the information described in paragraph (1) in 
     such form and at such frequency as the Commission may require 
     to comply with the public reporting requirements under 
     subsection (c)(6);
       ``(5) at the direction of the Commission, establish 
     automated systems for monitoring, screening, and analyzing 
     security-based swap data; and
       ``(6) maintain the confidentiality of security-based swap 
     transaction information that the registered security-based 
     swap data repository receives from a counterparty, swap 
     participant, or any other registered entity in accordance 
     with the requirements that the Commission shall jointly with 
     the Commodity Futures Trading Commission prescribe through 
     notice-and-comment rulemaking.
       ``(g) Regulatory Requirements Applicable to Registered 
     Security-Based Swap Data Repositories.--The Commission shall 
     adopt rules, by notice-and-comment rulemaking, for security-
     based swap data repositories that address the following:
       ``(1) Antitrust considerations.--Unless specifically 
     reviewed and approved by the Commission for antitrust 
     purposes, a registered security-based swap data repository 
     may not--
       ``(A) adopt any rule or take any action that results in any 
     unreasonable restraint of trade; or
       ``(B) impose any material anticompetitive burden on the 
     trading, clearing, or reporting of transactions.
       ``(2) Governance arrangements.--Each registered security-
     based swap data repository shall establish governance 
     arrangements--
       ``(A) that are transparent; and
       ``(B) that assure fair representation of the participants 
     of the repository in reasonable proportion to the use of the 
     repository by such participants in the selection of the 
     directors of the repository and the administration of the 
     affairs of the repository.
       ``(3) Conflicts of interest.--Each registered security-
     based swap data repository shall--
       ``(A) establish and enforce rules to minimize conflicts of 
     interest in the decision-making process of the security-based 
     swap data repository; and
       ``(B) establish a process for resolving conflicts of 
     interest described in subparagraph (A).
       ``(4) Non-discriminatory access.--A registered security-
     based swap data repository--
       ``(A) may not mandate directly or indirectly the 
     substantive terms and conditions of transactions reported to 
     the repository;
       ``(B) shall provide for the equitable allocation of 
     reasonable dues, fees, and other charges among the 
     participants of the repository and shall not impose any 
     schedule of prices, or fix rates or other fees, for services 
     rendered by such participants;
       ``(C) shall provide for participation in the repository by 
     any swap participant and any other person or class of persons 
     as the Commission, by rule or regulation, may determine to be 
     necessary or appropriate in furtherance of the purposes of 
     this section; and
       ``(D) shall not unfairly discriminate in the admission of 
     participants or among participants in the use of the 
     repository.''.

     SEC. 765. REGISTRATION AND REGULATION OF SWAP PARTICIPANTS.

       Section 17 of the Securities Exchange Act of 1934 (15 
     U.S.C. 78q) is amended by adding at the end the following:
       ``(l) Registration and Regulation of Swap Participants.--
       ``(1) Registration.--Swap participants shall register with 
     the Commission.
       ``(2) Notice registration.--A swap participant shall be 
     exempt from registration with the Commission if such 
     participant files a notice registration with the Commission 
     in the form and manner that the Commission shall prescribe, 
     jointly with the Commodity Futures Trading Commission, by 
     notice-and-comment rulemaking and--
       ``(A) such participant is exempt pursuant to a rule or 
     order issued by the Commission, jointly with the Commodity 
     Futures Trading Commission, to exempt swap participants that 
     engage primarily in non-security-based swap transactions and 
     are registered as swap participants with the Commodity 
     Futures Trading Commission; or
       ``(B) all of its outstanding swap transactions are cleared 
     swaps.
       ``(3) Requirements.--
       ``(A) In general.--A person shall register as a swap 
     participant by filing a registration application with the 
     Commission.
       ``(B) Contents.--
       ``(i) In general.--An application for registration under 
     this subsection shall be made in such form and manner and 
     contain such information as the Commission, jointly with the 
     Commodity Futures Trading Commission through notice-and-
     comment rulemaking, shall prescribe concerning the swap 
     activities of the swap participant.
       ``(ii) Continual reporting.--A registered swap participant 
     shall continue to submit to the Commission reports that 
     contain such information pertaining to the swap activities of 
     the swap participant as the Commission may require.
       ``(C) Transition.--Rules under this section shall provide 
     for the registration of swap participants not later than the 
     date that is 1 year after the date of enactment of the Over-
     the-Counter Swaps Markets Transparency and Accountability Act 
     of 2010.
       ``(D) Statutory disqualification.--Except to the extent 
     otherwise specifically provided by rule, regulation, or 
     order, it shall be unlawful for a swap participant to permit 
     any person associated with a swap participant who is subject 
     to a statutory disqualification to effect or be involved in 
     effecting swaps on behalf of the swap participant, if the 
     swap participant knew, or in the exercise of reasonable care 
     should have known, of the statutory disqualification.
       ``(m) Capital and Margin Requirements.--
       ``(1) Capital requirements for prudentially regulated swap 
     participants.--Each swap participant for which there is a 
     prudential regulator shall meet such minimum capital 
     requirements as such prudential regulator shall prescribe 
     pursuant to the authority of the prudential regulator.
       ``(2) Margin requirements for swap participants for 
     uncleared security-based swaps.--
       ``(A) In general.--Except as provided in paragraph (C), the 
     Commission shall prescribe by rule or regulation the minimum 
     margin requirements that apply to transactions between swap 
     participants in any particular uncleared security-based swap 
     or any group, category, type, or class of security-based 
     swap, as the Commission deems appropriate for the risk of 
     that particular uncleared security-based swap or class, 
     group, category, type of security-based swap, for the 
     purposes of--
       ``(i) reducing the risk of losses to counterparties; and
       ``(ii) preserving the financial integrity of markets 
     trading security-based swaps.
       ``(B) Considerations.--The Commission shall not issue rules 
     under this subsection unless the Commission determines that 
     such rules--
       ``(i) would not inappropriately encourage or discourage the 
     clearing of certain security-based swaps, resulting in an 
     undue increase in risk to the financial system;
       ``(ii) are supported by economic analysis provided by the 
     Chief Economist of the Commission; and
       ``(iii) would not impose any unnecessary burden on 
     competition.
       ``(C) Outstanding security-based swap positions.--The 
     Commission and the Commodity Futures Trading Commission may 
     by joint notice-and-comment rulemaking or order exempt any 
     security-based swap, group, category, type, or class of 
     security-based swap entered into on or before the date of 
     enactment of this Act. In determining whether an exemption is 
     appropriate, the Commission and the Commodity Futures Trading 
     Commission shall take into account the notional value, the 
     tenor, and the risk to the financial stability of the United 
     States posed by the underlying security-based swap, group, 
     category, type, or class of security-based swap.
       ``(D) Affiliate transactions.--The Commission shall not 
     impose minimum margin requirements on security-based swap 
     transactions in which one counterparty directly or indirectly 
     controls, is controlled by, or is under common control with 
     the other counterparty, provided, however, that the 
     Commission, jointly with the Financial Stability Oversight 
     Council, may determine, by notice-and-comment rulemaking, 
     that transactions between certain parties under common 
     control are subject to the minimum margin requirements 
     imposed by the Commission under this clause.
       ``(3) Special margin requirements for uncleared security-
     based swap transactions involving a swap participant with a 
     substantial net uncollateralized security-based swap 
     position.--If a swap participant has a substantial net 
     uncollateralized swap position, any subsequent swap 
     transaction, regardless of whether the swap participant's 
     counterparty is a swap participant, shall be subject to--
       ``(A) any applicable clearing requirement under section 
     17D(a); and
       ``(B) any applicable margin requirements that the 
     Commission has prescribed under paragraph (2).
       ``(4) Substantial net uncollateralized position.--
       ``(A) In general.--From time to time, the Financial 
     Stability Oversight Council shall define, by rule or 
     regulation, the term `substantial net uncollateralized 
     position' by identifying the level of uncollateralized 
     positions in swaps that a swap participant can hold without 
     posing a threat to the financial system stability of the 
     United States.
       ``(B) Reliance on economic analysis.--In making 
     determinations under this subsection, the Commission and the 
     Board shall rely on economic analysis provided by economists 
     of the Commission and economists of the Board.
       ``(n) Reporting and Recordkeeping.--With respect to its 
     swap business, each swap participant registered with the 
     Commission--
       ``(1) shall make such reports as are required by the 
     Commission, jointly with the Commodity Futures Trading 
     Commission through notice-and-comment rulemaking;

[[Page S3193]]

       ``(2)(A) for which there is a prudential regulator, shall 
     keep books and records in such form and manner and for such 
     period as may be prescribed by the prudential regulator; and
       ``(B) for which there is no prudential regulator, shall 
     keep books and records in such form and manner and for such 
     period as is be prescribed by the Commission, jointly with 
     the Commodity Futures Trading Commission through notice-and-
     comment rulemaking; and
       ``(3) shall keep books and records described in paragraph 
     (2)(B) open to inspection and examination by any 
     representative of the Commission.
       ``(o) Business Conduct Standards and Requirements.--With 
     respect to its swap business, each swap participant--
       ``(1) for which there is a prudential regulator, shall 
     comply with such business conduct standards and requirements 
     as the prudential regulator may impose; and
       ``(2) for which there is no prudential regulator, shall 
     comply with such business conduct standards and requirements 
     as the Commission, jointly with the Commodity Futures Trading 
     Commission through notice-and-comment rulemaking, shall 
     prescribe. The business conduct requirements prescribed under 
     this paragraph shall--
       ``(A) establish the standard of care required for a swap 
     participant to verify that any counterparty meets the 
     eligibility standards for an eligible contract participant; 
     and
       ``(B) require disclosure by the swap participant to any 
     counterparty to the swap (other than a counterparty that is a 
     swap participant) of--
       ``(i) information about the material risks and 
     characteristics of the security-based swap; and
       ``(ii) any material conflicts of interest that the swap 
     participant may have in connection with the security-based 
     swap.
       ``(p) Documentation and Back Office Standards.--Each swap 
     participant registered with the Commission--
       ``(1) for which there is a prudential regulator, shall 
     comply with such documentation and back office standards as 
     the prudential regulator may impose; and
       ``(2) for which there is no prudential regulator, shall 
     conform with such standards as the Commission, jointly with 
     the Commodity Futures Trading Commission through notice-and-
     comment rulemaking, may prescribe that relate to timely and 
     accurate confirmation, processing, netting, documentation, 
     and valuation of all security-based swaps.
       ``(q) Confidentiality.--
       ``(1) In general.--Notwithstanding any other provision of 
     law, the Commission may not be compelled to disclose any 
     information required by Commission rule or regulation to be 
     reported to the Commission under this subsection, except that 
     nothing in this paragraph authorizes the Commission to 
     withhold information from Congress, or prevent the Commission 
     from complying with a request for information from any other 
     Federal department or agency requesting information for 
     purposes within the scope of its jurisdiction, or complying 
     with an order of a court of the United States in an action 
     brought by the United States or the Commission.
       ``(2) Rule of construction.--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.
       ``(r) Segregation Requirements for Initial Margin.--
       ``(1) Segregation of initial margin.--
       ``(A) Notification of right to segregate initial margin.--A 
     swap participant shall notify its counterparty before 
     entering into a security-based swap transaction of the right 
     of the counterparty to require segregation of the funds or 
     other property supplied as initial margin for the purpose of 
     margining, guaranteeing, or securing the obligations of the 
     counterparty.
       ``(B) Segregation and maintenance of initial margin.--At 
     the request, made before entering into a security-based swap 
     transaction, of a counterparty that provides funds or other 
     property as initial margin to a swap participant for the 
     purpose of margining, guaranteeing, or securing the 
     obligations of the counterparty, the swap participant shall--
       ``(i) segregate the funds or other property for the benefit 
     of the counterparty; and
       ``(ii) in accordance with such rules and regulations as the 
     Commission may promulgate jointly with the Commodity Futures 
     Trading Commission, maintain the funds or other property in a 
     segregated account separate from the assets and other 
     interests of the swap participant.
       ``(C) Notification of excess variation margin.--Pursuant to 
     rules and regulations adopted by the Commission, a swap 
     participant who received funds or other property shall notify 
     any counterparty who provided such funds or other property if 
     the swap participant is holding excess net variation margin 
     from that counterparty.
       ``(2) Applicability.--The requirements described in 
     paragraph (1) shall--
       ``(A) apply only to a security-based swap between a 
     counterparty and a swap participant that is not submitted for 
     clearing to a clearing agency;
       ``(B) not apply to variation margin payments; and
       ``(C) not preclude any commercial arrangement regarding--
       ``(i) the investment of segregated funds or other property 
     that may only be invested in such investments as the 
     Commission may permit by rule or regulation; and
       ``(ii) the related allocation of gains and losses resulting 
     from any investment of the segregated funds or other 
     property.
       ``(3) Use of independent third-party custodians.--Each 
     segregated account described in paragraph (1), if requested 
     by the counterparty, may be--
       ``(A) carried by an independent third-party custodian; and
       ``(B) designated as a segregated account for and on behalf 
     of the counterparty.
       ``(4) Reporting requirement.--If a counterparty does not 
     choose to require segregation of the funds or other property 
     supplied as initial margin for the purpose of margining, 
     guaranteeing, or securing the obligations of the 
     counterparty, the swap participant shall report to the 
     counterparty of the swap participant on a quarterly basis 
     that the back office procedures of the swap participant 
     relating to initial margin and collateral requirements are in 
     compliance with the agreement of the counterparties.''.

     SEC. 766. LARGE SECURITY-BASED SWAP TRADER REPORTING.

       The Securities Exchange Act of 1934 is amended by inserting 
     after section 10A (15 U.S.C. 78j-1) the following:

     ``SEC. 10B. LARGE SECURITY-BASED SWAP TRADER REPORTING.

       ``(a) In General.--A person that buys or sells a security-
     based swap shall file or cause to be filed with the 
     Commission a report, if--
       ``(1) such person directly or indirectly buys or sells a 
     particular security-based swap or class of security-based 
     swap during any day equal to or in excess of any daily 
     reporting threshold that has been fixed, by rule or 
     regulation, with respect to a particular security-based swap 
     or class of security-based swap by the Commission; or
       ``(2) such person directly or indirectly has or obtains a 
     net position in such security-based swap or class of 
     security-based swap equal to or in excess of any net position 
     reporting threshold that has been fixed, by rule or 
     regulation, with respect to that particular security-based 
     swap or class of security-based swap by the Commission.
       ``(b) Report.--Each report required under subsection (a) 
     shall--
       ``(1) be in such form and be filed at such time as the 
     Commission shall prescribe, by rule or regulation; and
       ``(2) contain such information regarding any position or 
     positions in such security-based swap and any group or index 
     of securities on which such security-based swap is based or 
     is referenced, or to which such security-based swap is 
     related, or as to which the issuer of such security is 
     referenced and any other instrument relating to such security 
     or group or index of securities.
       ``(c) Determination of Reporting Thresholds.--
       ``(1) Chief economist.--In determining the reporting 
     thresholds set forth in subsection (a), the Commission shall 
     rely on economic analysis provided by the Chief Economist of 
     the Commission.
       ``(2) Considerations.--The economic analysis provided under 
     paragraph (1) shall take into account--
       ``(A) the market oversight benefits and the costs to market 
     participants from preparing reports; and
       ``(B) the costs to the Commission from processing 
     reports.''.

     SEC. 767. CERTAIN REPORTING REQUIREMENTS.

       (a) Beneficial Ownership Reporting.--Section 13 of the 
     Securities Exchange Act of 1934 (15 U.S.C. 78m) is amended--
       (1) in subsection (d), by adding at the end the following:
       ``(7) For purposes of this subsection, the Commission may 
     determine by rule or regulation that a person is deemed to 
     have acquired beneficial ownership of an equity security upon 
     the purchase or sale of a swap that results in the person 
     acquiring voting or control rights equivalent to those 
     arising from beneficial ownership of the equity security.''; 
     and
       (2) in subsection (g), by adding at the end the following:
       ``(7) For purposes of this subsection, the Commission may 
     determine by rule or regulation that a person is deemed to 
     have acquired beneficial ownership of an equity security upon 
     the purchase or sale of a swap that results in the person 
     acquiring voting or control rights equivalent to those 
     arising from beneficial ownership of the equity security.''.
       (b) Institutional Investment Manager Reporting.--Section 
     13(f)(5) of the Securities Exchange Act of 1934 (15 U.S.C. 
     78m(f)(5)) is amended by adding at the end the following:
       ``(C) For purposes of this subsection, an account shall be 
     deemed to be holding equity securities of a class described 
     in subsection (d)(1), if the account holds swaps that the 
     Commission has determined, by rule or regulation, result in 
     the person acquiring voting or control rights equivalent to 
     those arising from beneficial ownership of the equity 
     security.''.

     SEC. 768. PROHIBITION OF MARKET MANIPULATION, FRAUD, AND 
                   OTHER MARKET ABUSES.

       (a) Rulemaking Authority To Prevent Fraud, Manipulation, 
     and Deceptive Conduct in Security-Based Swaps.--Section 9 of 
     the Securities Exchange Act of 1934 (15 U.S.C. 78i) is 
     amended--

[[Page S3194]]

       (1) in the section heading, by inserting ``AND SECURITY-
     BASED SWAP'' after ``SECURITY''; and
       (2) by adding at the end the following:
       ``(j) Abuses Related to Security-Based Swaps.--It shall be 
     unlawful for any person, directly or indirectly, by the use 
     of any means or instrumentality of interstate commerce or of 
     the mails, or of any facility of any national securities 
     exchange, to effect any transaction in, or to induce or 
     attempt to induce the purchase or sale of, any security-based 
     swap, in connection with which such person engages in any 
     fraudulent, deceptive, or manipulative act or practice, makes 
     any fictitious quotation, or engages in any transaction, 
     practice, or course of business which operates as a fraud or 
     deceit upon any person. The Commission shall, for purposes of 
     this subsection, by rule or regulation, define and prescribe 
     means reasonably designed to prevent, such transactions, 
     acts, practices, and courses of business as are fraudulent, 
     deceptive, or manipulative, and such quotations as are 
     fictitious.''.
       (b) Additions of Swaps to Certain Anti-Manipulation 
     Provisions.--Section 9(b) of the Securities Exchange Act of 
     1934 (15 U.S.C. 78i(b)) is amended by striking paragraphs (1) 
     through (3) and inserting the following:
       ``(1) any transaction in connection with any security, 
     whereby any party to such transaction acquires--
       ``(A) any put, call, straddle, or other option or privilege 
     of buying the security from or selling the security to 
     another without being bound to do so;
       ``(B) any security futures product on the security; or
       ``(C) any swap involving the security or the issuer of the 
     security;
       ``(2) any transaction in connection with any security with 
     relation to which he has, directly or indirectly, any 
     interest in any--
       ``(A) such put, call, straddle, option, or privilege;
       ``(B) such security futures product; or
       ``(C) such swap; or
       ``(3) any transaction in any security for any account that 
     the person has reason to believe has, and that actually has, 
     directly or indirectly, any interest in any--
       ``(A) such put, call, straddle, option, or privilege;
       ``(B) such security futures product with relation to such 
     security; or
       ``(C) any swap involving such security or the issuer of 
     such security.''.

     SEC. 769. STATE GAMING AND BUCKET SHOP LAWS.

       Section 28(a) of the Securities Exchange Act of 1934 (15 
     U.S.C. 78bb(a)) is amended to read as follows:
       ``(a) Damages Amounts.--
       ``(1) Actual damages.--Except as provided in subsection 
     (f), the rights and remedies provided by this title shall be 
     in addition to any and all other rights and remedies that may 
     exist at law or in equity, but no person permitted to 
     maintain a suit for damages under the provisions of this 
     title shall recover, through satisfaction of judgment in 1 or 
     more actions, a total amount in excess of the actual damages 
     to such person on account of the act complained of. Except as 
     otherwise specifically provided in this title, nothing in 
     this title shall affect the jurisdiction of the securities 
     commission (or any agency or officer performing like 
     functions) of any State over any security or any person, 
     insofar as it does not conflict with the provisions of this 
     title or the rules and regulations thereunder.
       ``(2) Applicability of certain state laws.--No State law 
     which prohibits or regulates the making or promoting of 
     wagering or gaming contracts, or the operation of `bucket 
     shops' or other similar or related activities, shall 
     invalidate--
       ``(A) any put, call, straddle, option, privilege, or other 
     security subject to this title (except any security that has 
     a pari-mutual payout or otherwise is determined by the 
     Commission, acting by rule, regulation, or order, to be 
     appropriately subject to such laws), or apply to any activity 
     which is incidental or related to the offer, purchase, sale, 
     exercise, settlement, or closeout of any such security;
       ``(B) any security-based swap between eligible contract 
     participants; or
       ``(C) any security-based swap effected on a national 
     securities exchange registered pursuant to section 6(b).
       ``(3) Limitation.--Notwithstanding paragraph (2), no 
     provision of State law regarding the offer, sale, or 
     distribution of securities shall apply to any transaction in 
     a security futures product, except that this paragraph may 
     not be construed as limiting any State antifraud law of 
     general applicability.''.

     SEC. 770. PROTECTIONS FOR MARKETING SECURITY-BASED SWAPS AND 
                   LISTING STANDARDS.

       Section 6 of the Securities Exchange Act of 1934 (15 U.S.C. 
     78f) is amended by adding at the end the following:
       ``(l) Trading in Security-Based Swaps.--
       ``(1) In general.--It shall be unlawful for any person to 
     effect a transaction in a security-based swap with or for a 
     person that is not an eligible contract participant, unless 
     such transaction is effected on a national securities 
     exchange registered pursuant to subsection (b).
       ``(2) Listing standards required.--A national securities 
     exchange or a national securities association registered 
     pursuant to section 15A(a) may trade security-based swaps 
     that conform with listing standards that such exchange or 
     association files with the Commission under section 19(b).''.

     SEC. 771. ENFORCEABILITY OF SECURITY-BASED SWAPS.

       Section 29(b) of the Securities Exchange Act of 1934 (15 
     U.S.C. 78cc(b)) is amended by striking ``and (B) that no 
     contract'' and inserting the following: ``(B) that no 
     agreement, contract, or transaction that is a security-based 
     swap shall be void, voidable, or unenforceable by either 
     party to such security-based swap, and no party thereto shall 
     be entitled to rescind, or recover any payment made with 
     respect to, such security-based swap under this section or 
     any other provision of securities laws based solely on the 
     failure of either party to the agreement, contract, or 
     transaction to satisfy its respective obligations under 
     sections 6(l), 13, 15(b), 17, and 17C of this title with 
     respect to such security-based swap, and (C) that no 
     contract''.
                                 ______
                                 
  SA 3817. Mr. WHITEHOUSE submitted an amendment intended to be 
proposed to amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for 
himself and Mrs. Lincoln)) to the bill S. 3217, to promote the 
financial stability of the United States by improving accountability 
and transparency in the financial system, to end ``too big to fail'', 
to protect the American taxpayer by ending bailouts, to protect 
consumers from abusive financial services practices, and for other 
purposes; which was ordered to lie on the table; as follows:

       On page 1171, between lines 5 and 6, insert the following:

     SEC. 989C. PREVENTING BLANK CHECK BAILOUTS.

       (a) Short Title.--This section may be cited as the 
     ``Preventing Blank Check Bailouts Act of 2010''.
       (b) Definitions.--In this section:
       (1) Covered entity.--The term ``covered entity''--
       (A) means a corporation, partnership, association, trust, 
     firm, joint stock company, or other business entity that--
       (i) has outstanding not less than $10,000,000,000 in 
     Government assistance; or
       (ii) receives Government assistance for the protection of 
     the public; and
       (B) does not include a State, a political subdivision of a 
     State, or an entity owned or controlled by a State or a 
     political subdivision of a State.
       (2) Executive compensation.--The term ``executive 
     compensation'' includes wages, salary, deferred compensation, 
     benefits, retirement arrangements, options, bonuses, office 
     fixtures, goods and other property, travel, entertainment or 
     vacation expenses, and forms of compensation, obligation, or 
     expense that are not routinely provided to all other 
     employees of a covered entity.
       (3) Government assistance.--The term ``Government 
     assistance'' means any grants, gifts, loans, equity or debt 
     purchases, or other investments by the United States made or 
     provided to prevent the insolvency of the recipient for the 
     protection of the public.
       (4) Taxpayer protection action.--The term ``taxpayer 
     protection action'' means a civil action brought under 
     subsection (c)(1).
       (c) Taxpayer Protection Actions.--
       (1) In general.--The district courts of the United States 
     shall have jurisdiction of a civil action brought by the 
     Attorney General of the United States against a covered 
     entity seeking the abrogation of contracts of the covered 
     entity.
       (2) Consultation.--The Attorney General shall consult with 
     the President and the Secretary of the Treasury before 
     bringing a taxpayer protection action.
       (3) Remedies.--
       (A) In general.--In a taxpayer protection action, the court 
     may abrogate contracts of the covered entity, including 
     contracts relating to executive compensation, in accordance 
     with subparagraph (B), if the court determines that a covered 
     entity--
       (i) would have become insolvent if the covered entity had 
     not received the Government assistance outstanding to or in 
     the covered entity; or
       (ii) would become insolvent if the covered entity does not 
     receive Government assistance.
       (B) Contracts to be abrogated.--In evaluating the contracts 
     of a covered entity under this paragraph, a court shall apply 
     a standard to the contracts that seeks to approximate the 
     outcome that would have resulted for the parties to the 
     contract if the covered entity--
       (i) had not received the Government assistance; and
       (ii) had filed a petition under chapter 7 of title 11, 
     United States Code.
       (4) Individuals and entities affected.--If the property 
     rights of an individual or entity will be affected by a 
     taxpayer protection action, the individual or entity may--
       (A) intervene as a matter of right in the taxpayer 
     protection action; and
       (B) upon intervening, assert any claim relating to the 
     property rights of the individual or entity, including a 
     claim--
       (i) relating to rights protected under the due process 
     clause of the fifth amendment to the Constitution of the 
     United States or the due process clause of section 1 of the 
     14th

[[Page S3195]]

     amendment to the Constitution of the United States; or
       (ii) that the covered entity is not insolvent or would not 
     have become insolvent if the covered entity had not received 
     the Government assistance.
                                 ______
                                 
  SA 3818. Mr. MENENDEZ (for himself and Mr. Merkley), submitted an 
amendment intended to be proposed to amendment SA 3739 proposed by Mr. 
Reid (for Mr. Dodd (for himself and Mrs. Lincoln)) to the bill S. 3217, 
to promote the financial stability of the United States by improving 
accountability and transparency in the financial system, to end ``too 
big to fail'', to protect the American taxpayer by ending bailouts, to 
protect consumers from abusive financial services practices, and for 
other purposes; which was ordered to lie on the table; as follows:

       On page 1068, strike line 10 and all that follows through 
     page 1069, line 6, and insert the following:

     SEC. 955. EMPLOYEE HEDGING PROHIBITED.

       Section 12 of the Securities Exchange Act of 1934 (15 
     U.S.C. 78l) is amended by adding at the end the following:
       ``(m) Hedging by Officers and Directors Prohibited.--
       ``(1) Definitions.--In this subsection--
       ``(A) the term `covered employee' means--
       ``(i) an officer or director of an issuer of a class of 
     securities registered under this section; and
       ``(ii) an employee of an issuer of a class of securities 
     registered under this section who receives from the issuer 
     annual wages of $1,000,000 or more;
       ``(B) the term `related person' means a related person of 
     an officer, director, or employee described in subparagraph 
     (A), as defined by the Commission, by rule; and
       ``(C) the term `wages' has the same meaning as in section 
     3121(a) of the Internal Revenue Code of 1986, without regard 
     to paragraph (1) thereof.
       ``(2) Prohibition.--A covered employee or related person 
     may not--
       ``(A) purchase or sell a security (other than a security 
     beneficially owned by the covered employee that is issued by 
     the issuer that employs the covered employee or any affiliate 
     of the issuer), derivative, or other financial product that 
     in any way hedges or limits the financial exposure of the 
     covered employee to declines in the market value of any 
     security beneficially owned by the covered employee that is 
     issued by the issuer that employs the covered employee or any 
     affiliate of the issuer; or
       ``(B) enter into an agreement with any third party in which 
     a security issued by the issuer that employs the covered 
     employee is a material term of the agreement, if the 
     agreement in any way hedges or limits the financial exposure 
     of the covered employee to declines in the market value of 
     any security beneficially owned by the covered employee that 
     is issued by the issuer that employs the covered employee or 
     any affiliate of the issuer.''.
                                 ______
                                 
  SA 3819. Mr. BROWN of Ohio submitted an amendment intended to be 
proposed to amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for 
himself and Mrs. Lincoln)) to the bill S. 3217, to promote the 
financial stability of the United States by improving accountability 
and transparency in the financial system, to end ``too big to fail'', 
to protect the American taxpayer by ending bailouts, to protect 
consumers from abusive financial services practices, and for other 
purposes; which was ordered to lie on the table; as follows:

       On page 191, after line 24, insert the following new 
     subparagraphs after subparagraph (B) and redesignate the 
     subsequent subparagraphs:
       (C) Wages, salaries, or commissions, including vacation, 
     severance, and sick leave pay earned by an individual (other 
     than management responsible for the failed condition of the 
     covered financial company who have been removed), but only to 
     the extent of $11,725 for each individual (as indexed for 
     inflation by regulation of the Corporation) earned within 180 
     days before the appointment of the Corporation as receiver.
       (D) Contributions owed to employee benefit plans arising 
     from services rendered within 180 days before the appointment 
     of the Corporation as receiver to the extent of the number of 
     employees covered by each such plan multiplied by $11,725 (as 
     indexed for inflation by regulation of the Corporation), less 
     the aggregate amount paid to such employees under 
     subparagraph (C) plus the aggregate amount paid by the 
     receivership on behalf of such employees to any other 
     employee benefit plan.
                                 ______
                                 
  SA 3820. Mr. BROWN of Ohio submitted an amendment intended to be 
proposed to amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for 
himself and Mrs. Lincoln)) to the bill S. 3217, to promote the 
financial stability of the United States by improving accountability 
and transparency in the financial system, to end ``too big to fail'', 
to protect the American taxpayer by ending bailouts, to protect 
consumers from abusive financial services practices, and for other 
purposes; which was ordered to lie on the table; as follows:

       On page 235, between lines 13 and 14, insert the following 
     new subparagraph after subparagraph (C) and redesignate the 
     subsequent subparagraph:
       (D) Services performed under a collective bargain agreement 
     after appointment and prior to repudiation.--If, in the case 
     of any collective bargaining agreement between a labor 
     organization and a covered financial company, the Corporation 
     as receiver accepts performance of services subject to such 
     agreement before making any determination to exercise the 
     right of repudiation of such collective bargaining agreement 
     under this section--
       (i) the persons covered by such collective bargaining 
     agreement shall be paid under the terms of such agreement for 
     the services performed; and
       (ii) the amount of such payment shall be treated as an 
     administrative expense of the receivership.
                                 ______
                                 
  SA 3821. Mr. BROWN of Ohio submitted an amendment intended to be 
proposed to amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for 
himself and Mrs. Lincoln)) to the bill S. 3217, to promote the 
financial stability of the United States by improving accountability 
and transparency in the financial system, to end ``too big to fail'', 
to protect the American taxpayer by ending bailouts, to protect 
consumers from abusive financial services practices, and for other 
purposes; which was ordered to lie on the table; as follows:

       On page 1044, between lines 2 and 3, insert the following:

     SEC. 939D. EFFECT OF RULE 436(G).

       Section 220.436(g) of title 17, Code of Federal 
     Regulations, commonly referred to as ``Rule 436(g) under the 
     Securities Act of 1933'', shall have no force or effect.
                                 ______
                                 
  SA 3822. Mr. DODD (for himself and Mr. Shelby) submitted an amendment 
intended to be proposed to amendment SA 3739 proposed by Mr. Reid (for 
Mr. Dodd (for himself and Mrs. Lincoln)) to the bill S. 3217, to 
promote the financial stability of the United States by improving 
accountability and transparency in the financial system, to end ``too 
big to fail'', to protect the American taxpayer by ending bailouts, to 
protect consumers from abusive financial services practices, and for 
other purposes; which was ordered to lie on the table; as follows:

       On page 111, line 7, insert ``(a) In General.--'' before 
     ``In''.
       On page 114, line 14, after ``(iii)'' insert ``that is 
     predominantly engaged in activities that the Board of 
     Governors has determined are financial in nature or 
     incidental thereto for purposes of section 4(k) of the Bank 
     Holding Company Act of 1956 (12 U.S.C. 1843(k))''.
       On page 114, line 21, after ``(12 U.S.C. 2001 et seq.)'' 
     insert ``, a governmental entity, or a regulated entity, as 
     defined under section 1303 of the Federal Housing Enterprises 
     Financial Safety and Soundness Act of 1992 (12 U.S.C. 
     4502(20))''.
       On page 115, strike lines 18 through 20, and insert the 
     following:
       (15) Court.--The term ``Court'' means the United States 
     District Court for the District of Columbia.
       On page 115, between lines 22 and 23, insert the following:
       (b) Definitional Criteria.--For purpose of the definition 
     of the term ``financial company'' under subsection (a)(10), 
     no company shall be deemed to be predominantly engaged in 
     activities that the Board of Governors has determined are 
     financial in nature or incidental thereto for purposes of 
     section 4(k) of the Bank Holding Company Act of 1956 (12 
     U.S.C. 1843(k)), if the consolidated revenues of such company 
     from such activities constitute less than 85 percent of the 
     total consolidated revenues of such company, as the 
     Corporation, in consultation with the Secretary, shall 
     establish by regulation. In determining whether a company is 
     a financial company under this title, the consolidated 
     revenues derived from the ownership or control of a 
     depository institution shall be included.
       On page 115, line 23, strike ``ORDERLY LIQUIDATION 
     AUTHORITY PANEL'' and insert ``JUDICIAL REVIEW''.
       On page 115, strike line 24 and all that follows through 
     page 116, line 16.
       On page 116, line 17, strike ``(b)'' and insert ``(a)''.
       On page 116, strike lines 18 through 20, and insert the 
     following:
       (1) Petition to district court.--
       (A) District court review.--
       On page 116, strike line 21 and all that follows through 
     page 117, line 4, and insert the following:
       (i) Petition to district court.--Subsequent to a 
     determination by the Secretary under section 203 that a 
     financial company satisfies the criteria in section 203(b), 
     the Secretary shall notify the Corporation and

[[Page S3196]]

     the covered financial company. If the board of directors (or 
     body performing similar functions) of the covered financial 
     company acquiesces or consents to the appointment of the 
     Corporation as a receiver, the Secretary shall appoint the 
     Corporation as a receiver. If the board of directors (or body 
     performing similar functions) of the covered financial 
     company does not acquiesce or consent to the appointment of 
     the Corporation as receiver, the Secretary shall petition the 
     United States District Court for the District of Columbia for 
     an order authorizing the Secretary to appoint the Corporation 
     as a receiver.
       On page 117, line 9, strike ``Panel'' and insert ``Court''.
       On page 117, line 13, strike ``Panel'' and insert 
     ``Court''.
       On page 117, beginning on line 16, strike ``, within 24 
     hours of receipt of the petition filed by the Secretary,''.
       On page 117, line 21, strike ``is supported'' and all that 
     follows through line 22, and insert ``and satisfies the 
     definition of a financial company under section 201(10) is 
     arbitrary and capricious.''.
       On page 117, line 24, strike ``Panel'' and insert 
     ``Court''.
       On page 118, line 2, insert ``and satisfies the definition 
     of a financial company under section 201(10)'' after ``danger 
     of default''.
       On page 118, lines 3 and 4, strike ``is supported by 
     substantial evidence'' and insert ``is not arbitrary and 
     capricious''.
       On page 118, line 4, strike ``Panel'' and insert ``Court''.
       On page 118, lines 9 and 10, strike ``is not supported by 
     substantial evidence'' and insert ``is arbitrary and 
     capricious''.
       On page 118, line 10, strike ``Panel'' and insert 
     ``Court''.
       On page 118, between lines 16 and 17, insert the following:
       (v) Petition granted by operation of law.--If the Court 
     does not make a determination within 24 hours of receipt of 
     the petition--

       (I) the petition shall be granted by operation of law;
       (II) the Secretary shall appoint the Corporation as 
     receiver; and
       (III) liquidation under this title shall automatically and 
     without further notice or action be commenced and the 
     Corporation may immediately take all actions authorized under 
     this title.

       On page 118, line 18, strike ``Panel'' and insert 
     ``Court''.
       On page 118, line 23, strike ``Panel'' and insert 
     ``Court''.
       On page 119, line 1, strike ``Panel'' and insert ``Court''.
       On page 119, line 12, strike ``panel'' and insert 
     ``district court''.
       On page 119, line 16, strike ``Third Circuit'' and insert 
     ``District of Columbia Circuit''.
       On page 119, line 17, strike ``Panel'' and insert 
     ``Court''.
       On page 119, line 23, strike ``Panel'' and insert 
     ``Court''.
       On page 120, strike lines 16 through 17 and insert 
     ``default and satisfies the definition of a financial company 
     under section 201(10) is arbitrary and capricious.''.
       On page 121, lines 19 and 20, strike ``is supported by 
     substantial evidence'' and insert ``and satisfies the 
     definition of a financial company under section 201(10) is 
     arbitrary and capricious''.
       On page 121, line 21, strike ``(c)'' and insert ``(b)''.
       On page 121, line 24, strike ``Panel'' and insert 
     ``Court''.
       On page 122, line 5, strike ``subsection (b)(1)'' and all 
     that follows through line 9, and insert ``subsection 
     (a)(1).''.
       On page 122, strike lines 14 through 16.
       On page 122, line 17, strike ``(C)'' and insert ``(A)''.
       On page 122, line 19, strike ``(D)'' and insert ``(B)''.
       On page 122, line 21, strike ``(E)'' and insert ``(C)''.
       On page 122, line 23, strike ``(F)'' and insert ``(D)''.
       On page 123, line 1, strike ``(d)'' and insert ``(c)''.
       On page 123, between lines 14 and 15, insert the following:
       (d) Time Limit on Receivership Authority.--
       (1) Baseline period.--Any appointment of the Corporation as 
     receiver under this section shall terminate at the end of the 
     3-year period beginning on the date on which such appointment 
     is made.
       (2) Extension of time limit.--The time limit established in 
     paragraph (1) may be extended by the Corporation for up to 1 
     additional year, if the Chairperson of the Corporation 
     determines and certifies in writing to the Committee on 
     Banking, Housing, and Urban Affairs of the Senate and the 
     Committee on Financial Services of the House of 
     Representatives that continuation of the receivership is 
     necessary--
       (A) to--
       (i) maximize the net present value return from the sale or 
     other disposition of the assets of the covered financial 
     company; or
       (ii) minimize the amount of loss realized upon the sale or 
     other disposition of the assets of the covered financial 
     company; and
       (B) to protect the stability of the financial system of the 
     United States.
       (3) Second extension of time limit.--
       (A) In general.--The time limit under this subsection, as 
     extended under paragraph (2), may be extended for up to 1 
     additional year, if the Chairperson of the Corporation, with 
     the concurrence of the Secretary, submits the certifications 
     described in paragraph (2).
       (B) Additional report required.--Not later than 30 days 
     after the date of commencement of the extension under 
     subparagraph (A), the Corporation 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 need for the extension and 
     the specific plan of the Corporation to conclude the 
     receivership before the end of the second extension.
       (4) Ongoing litigation.--The time limit under this 
     subsection, as extended under paragraph (3), may be further 
     extended solely for the purpose of completing ongoing 
     litigation in which the Corporation as receiver is a party, 
     provided that the appointment of the Corporation as receiver 
     shall terminate not later than 90 days after the date of 
     completion of such litigation, if--
       (A) the Council determines that the Corporation used its 
     best efforts to conclude the receivership in accordance with 
     its plan before the end of the time limit described in 
     paragraph (3);
       (B) the Council determines that the completion of longer-
     term responsibilities in the form of ongoing litigation 
     justifies the need for an extension; and
       (C) the Corporation submits a report approved by the 
     Council not later than 30 days after the date of the 
     determinations by the Council under subparagraphs (A) and (B) 
     to the Committee on Banking, Housing, and Urban Affairs of 
     the Senate and the Committee on Financial Services of the 
     House of Representatives, describing--
       (i) the ongoing litigation justifying the need for an 
     extension; and
       (ii) the specific plan of the Corporation to complete the 
     litigation and conclude the receivership.
       (5) Regulations.--The Corporation may issue regulations 
     governing the termination of receiverships under this title.
       (6) No liability.--The Corporation and the Deposit 
     Insurance Fund shall not be liable for unresolved claims 
     arising from the receivership after the termination of the 
     receivership.
       On page 123, line 21, strike ``Panel'' and insert 
     ``Court''.
       On page 124, line 11, strike ``Panel'' and insert 
     ``Court''.
       On page 126, between lines 9 and 10, insert the following:
       (g) Study of Prompt Corrective Action Implementation by the 
     Appropriate Federal Agencies.--
       (1) Study.--The Comptroller General of the United States 
     shall conduct a study regarding the implementation of prompt 
     corrective action by the appropriate Federal banking 
     agencies.
       (2) Issues to be studied.--In conducting the study under 
     paragraph (1), the Comptroller General shall evaluate--
       (A) the effectiveness of implementation of prompt 
     corrective action by the appropriate Federal banking agencies 
     and the resolution of insured depository institutions by the 
     Corporation; and
       (B) ways to make prompt corrective action a more effective 
     tool to resolve the insured depository institutions at the 
     least possible long-term cost to the Deposit Insurance Fund.
       (3) Report to council.--Not later than 1 years after the 
     date of enactment of this Act, the Comptroller General shall 
     submit a report to the Council on the results of the study 
     conducted under this subsection.
       (4) Council report of action.--Not later than 6 months 
     after the date of receipt of the report from the Comptroller 
     General under paragraph (3), the Council 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 on actions taken in response 
     to the report, including any recommendations made to the 
     Federal primary financial regulatory agencies under section 
     120.
       On page 128, line 9, strike ``and''.
       On page 128, line 12, strike the period at the end and 
     insert ``; and''.
       On page 128, between lines 12 and 13, insert the following:
       (G) an evaluation of whether the company satisfies the 
     definition of a financial company under section 201.
       On page 128, line 16, strike ``202(b)(1)(A)'' and insert 
     ``202(a)(1)(A)''.
       On page 129, line 17, strike ``and''.
       On page 129, line 21, strike the period at the end and 
     insert ``; and''.
       On page 129, between lines 21 and 22, insert the following:
       (7) the company satisfies the definition of a financial 
     company under section 201.
       On page 132, strike lines 3 through 17, and insert the 
     following:
       (A) In general.--Not later than 60 days after the date of 
     appointment of the Corporation as receiver for a covered 
     financial company, the Corporation shall file a report with 
     the Committee on Banking, Housing, and Urban Affairs of the 
     Senate and the Committee on Financial Services of the House 
     of Representatives--
       (i) setting forth information on the financial condition of 
     the covered financial company as of the date of the 
     appointment, including a description of its assets and 
     liabilities;
       (ii) describing the plan of, and actions taken by, the 
     Corporation to wind down the covered financial company;

[[Page S3197]]

       (iii) explaining each instance in which the Corporation 
     waived any applicable requirements of part 366 of title 12, 
     Code of Federal Regulations (or any successor thereto) with 
     respect to conflicts of interest by any person in the private 
     sector who was retained to provide services to the 
     Corporation in connection with such receivership;
       (iv) describing the reasons for the provision of any 
     funding to the receivership out of the Fund;
       (v) setting forth the expected costs of the orderly 
     liquidation of the covered financial company;
       (vi) setting forth the identity of any claimant that is 
     treated in a manner different from other similarly situated 
     claimants under subsection (b)(4), (d)(4), or (h)(5)(E), the 
     amount of any additional payment to such claimant under 
     subsection (d)(4), and the reason for any such action; and
       (vii) which report the Corporation shall publish on an 
     online website maintained by the Corporation, subject to 
     maintaining appropriate confidentiality.
       On page 132, between lines 22 and 23, insert the following:
       (C) Congressional testimony.--The Corporation and the 
     primary financial regulatory agency, if any, of the financial 
     company for which the Corporation was appointed receiver 
     under this title shall appear before Congress, if requested, 
     not later than 30 days after the date on which the 
     Corporation first files the reports required under 
     subparagraph (A).
       On page 135, line 15, strike ``section 202(b)'' and insert 
     ``section 202(a)''.
       On page 136, line 9, strike ``with the strong presumption'' 
     and insert ``so''.
       On page 138, line 16, insert after the period the 
     following: ``All funds provided by the Corporation under this 
     subsection shall have a priority of claims under subparagraph 
     (A) or (B) of section 210(b)(1), as applicable, including 
     funds used for--
       ``(1) making loans to, or purchasing any debt obligation 
     of, the covered financial company or any covered subsidiary;
       ``(2) purchasing or guaranteeing against loss the assets of 
     the covered financial company or any covered subsidiary, 
     directly or through an entity established by the Corporation 
     for such purpose;
       ``(3) assuming or guaranteeing the obligations of the 
     covered financial company or any covered subsidiary to 1 or 
     more third parties;
       ``(4) taking a lien on any or all assets of the covered 
     financial company or any covered subsidiary, including a 
     first priority lien on all unencumbered assets of the covered 
     financial company or any covered subsidiary to secure 
     repayment of any transactions conducted under this 
     subsection;
       ``(5) selling or transferring all, or any part, of such 
     acquired assets, liabilities, or obligations of the covered 
     financial company or any covered subsidiary; and
       ``(6) making payments pursuant to subsections (b)(4), 
     (d)(4), and (h)(5)(E) of section 210.''.
       On page 138, line 15, strike ``section 210(n)(13)'' and 
     insert ``section 210(n)(11)''.
       On page 147, line 3, insert before the period the 
     following: ``, and address the potential for conflicts of 
     interest between or among individual receiverships 
     established under this title or under the Federal Deposit 
     Insurance Act''.
       On page 187, line 18, strike ``(B), and (C)'' and insert 
     ``(B), (C), and (D)''.
       On page 187, line 20, strike ``(D)'' and insert ``(E)''.
       On page 192, insert before line 1 the following:
       (C) Wages, salaries, or commissions, including vacation, 
     severance, and sick leave pay earned by an individual (other 
     than an individual described in subparagraph (G)), but only 
     to the extent of $11,725 for each individual (as indexed for 
     inflation, by regulation of the Corporation) earned not later 
     than 180 days before the date of appointment of the 
     Corporation as receiver.
       (D) Contributions owed to employee benefit plans arising 
     from services rendered not later than 180 days before the 
     date of appointment of the Corporation as receiver, to the 
     extent of the number of employees covered by each such plan, 
     multiplied by $11,725 (as indexed for inflation, by 
     regulation of the Corporation), less the aggregate amount 
     paid to such employees under subparagraph (C), plus the 
     aggregate amount paid by the receivership on behalf of such 
     employees to any other employee benefit plan.
       On page 192, line 1, strike ``(C)'' and insert ``(E)''.
       On page 192, beginning on line 3, strike ``(D) or (E)'' and 
     insert ``(F), (G), or (H)''.
       On page 192, line 5, strike ``(D)'' and insert ``(F)''.
       On page 192, between lines 7 and 8, insert the following:
       (G) Any wages, salaries, or commissions including vacation, 
     severance, and sick leave pay earned, owed to senior 
     executives and directors of the covered financial company.
       On page 192, line 7, strike ``subparagraph (E)).'' and 
     insert ``subparagraph (G) or (H)).''.
       On page 192, line 8, strike ``(E)'' and insert ``(H)''.
       On page 193, line 18, strike ``(ii)'' and insert the 
     following:
       ``(ii) to initiate and continue operations essential to 
     implementation of the receivership or any bridge financial 
     company;
       ``(iii)''.
       On page 228, line 17, strike ``5th'' and insert ``3rd''.
       On page 236, line 20, strike ``5th'' and insert ``3rd''.
       On page 237, line 14, strike ``5th'' and insert ``3rd''.
       On page 240, line 8, strike ``section 202(c)(1)'' and 
     insert ``section 202(a)(1)''.
       On page 246, strike line 21 and all the follows through 
     page 247, line 5, and insert the following:
       (B) Limitations.--
       (i) Prohibition.--The Corporation shall not make any 
     payments or credit amounts to any claimant or category of 
     claimants that would result in any claimant receiving more 
     than the face value amount of any claim that is proven to the 
     satisfaction of the Corporation.
       (ii) No obligation.--Notwithstanding any other provision of 
     Federal or State law, or the Constitution of any State, the 
     Corporation shall not be obligated, as a result of having 
     made any payment under subparagraph (A) or credited any 
     amount described in subparagraph (A) to or with respect to, 
     or for the account, of any claimant or category of claimants, 
     to make payments to any other claimant or category of 
     claimants.
       On page 254, line 24, strike ``(13)'' and insert ``(11)''.
       On page 260, line 4, strike ``subsection (o)(1)(E)(ii))'' 
     and insert ``subsection (o)(1)(D)(ii))''.
       On page 263, line 16, strike ``(13)'' and insert ``(11)''.
       On page 278, line 5, strike ``(9)'' and insert ``(6)''.
       On page 278, line 10, strike ``(9)'' and insert ``(6)''.
       On page 278, strike line 18 and all that follows through 
     page 279, line 20.
       On page 279, line 21, strike ``(8)'' and insert ``(4)''.
       On page 280, line 5, strike ``(9)'' and insert ``(5)''.
       On page 281, line 6, strike the period and insert the 
     following: ``, plus an interest rate surcharge to be 
     determined by the Secretary, which shall be greater than the 
     difference between--
       ``(i) the current average rate on an index of corporate 
     obligations of comparable maturity; and
       ``(ii) the current average rate on outstanding marketable 
     obligations of the United States of comparable maturity.''.
       On page 281, strike line 20 and all that follows through 
     page 282, line 8, and insert the following:
       (6) Maximum obligation limitation.--The Corporation may 
     not, in connection with the orderly liquidation of a covered 
     financial company, issue or incur any obligation, if, after 
     issuing or incurring the obligation, the aggregate amount of 
     such obligations outstanding under this subsection for each 
     covered financial company would exceed--
       (A) an amount that is equal to 10 percent of the total 
     consolidated assets of the covered financial company, based 
     on the most recent financial statement available, during the 
     30-day period immediately following the date of appointment 
     of the Corporation as receiver (or a shorter time period if 
     the Corporation has calculated the amount described under 
     subparagraph (B)); and
       (B) the amount that is equal to 90 percent of the fair 
     value of the total consolidated assets of each covered 
     financial company that are available for repayment, after the 
     time period described in subparagraph (A).
       On page 282, line 9, strike ``(11)'' and insert ``(7)''.
       On page 282, strike lines 14 through 19.
       On page 282, line 20, strike ``(13)'' and insert ``(8)''.
       On page 283, strike lines 5 through 14 and insert the 
     following:
       (i) the authorities of the Corporation contained in this 
     title shall not be used to assist the Deposit Insurance Fund 
     or to assist any financial company under applicable law other 
     than this Act;
       (ii) the authorities of the Corporation relating to the 
     Deposit Insurance Fund, or any other responsibilities of the 
     Corporation under applicable law other than this title, shall 
     not be used to assist a covered financial company pursuant to 
     this title; and
       (iii) the Deposit Insurance Fund may not be used in any 
     manner to otherwise circumvent the purposes of this title.
       On page 283, line 24, strike ``(14)'' and insert ``(9)''.
       On page 284, line 6, insert ``, including taking any 
     actions specified'' before ``under 204(d)''.
       On page 284, line 7, insert before the period ``, and 
     payments to third parties''.
       On page 284, between lines 10 and 11, insert the following:
       (10) Implementation expenses.--
       (A) In general.--Reasonable implementation expenses of the 
     Corporation incurred after the date of enactment of this Act 
     shall be treated as expenses of the Council.
       (B) Requests for reimbursement.--The Corporation shall 
     periodically submit a request for reimbursement for 
     implementation expenses to the Chairperson of the Council, 
     who shall arrange for prompt reimbursement to the Corporation 
     of reasonable implementation expenses.
       (C) Definition.--As used in this paragraph, the term 
     ``implementation expenses''--
       (i) means costs incurred by the Corporation beginning on 
     the date of enactment of this Act, as part of its efforts to 
     implement this title that do not relate to a particular 
     covered financial company; and
       (ii) includes the costs incurred in connection with the 
     development of policies, procedures, rules, and regulations 
     and other planning activities of the Corporation consistent 
     with carrying out this title.

[[Page S3198]]

       On page 284, strike line 13 and all that follows through 
     page 285, line 2.
       On page 285, line 3, strike ``(B)'' and insert ``(A)''.
       On page 285, line 10, strike ``(C)'' and insert ``(B)''.
       On page 285, line 10, strike ``Additional''.
       On page 285, line 13, strike ``(E)'' and insert ``(D)''.
       On page 285, strike lines 14 through 23.
       On page 285, line 24, strike ``(iii)''.
       On page 285, line 21, strike ``during the initial 
     capitalization period''.
       On page 286, strike line 11 and all that follows through 
     page 287, line 2, and insert the following:
       (D) Application of assessments.--To meet the requirements 
     of subparagraph (C), the Corporation shall--
       (i) impose assessments, as soon as practicable, on any 
     claimant that received additional payments or amounts from 
     the Corporation pursuant to subsection (b)(4), (d)(4), or 
     (h)(5)(E), except for payments or amounts necessary to 
     initiate and continue operations essential to implementation 
     of the receivership or any bridge financial company, to 
     recover on a cumulative basis, the entire difference 
     between--

       (I) the aggregate value the claimant received from the 
     Corporation on a claim pursuant to this title (including 
     pursuant to subsection (b)(4), (d)(4), and (h)(5)(E)), as of 
     the date on which such value was received; and
       (II) the value the claimant was entitled to receive from 
     the Corporation on such claim solely from the proceeds of the 
     liquidation of the covered financial company under this 
     title; and

       (ii) if the amounts to be recovered on a cumulative basis 
     under clause (i) are insufficient to meet the requirements of 
     subparagraph (C), after taking into account the 
     considerations set forth in paragraph (4), impose assessments 
     on--

       (I) eligible financial companies; and
       (II) financial companies with total consolidated assets 
     equal to or greater than $50,000,000,000 that are not 
     eligible financial companies.

       (E) Provision of financing.--Payments or amounts necessary 
     to initiate and continue operations essential to 
     implementation of the receivership or any bridge financial 
     company described in subparagraph (E)(i) shall not include 
     the provision of financing, as defined by rule of the 
     Corporation, to third parties.
       On page 287, strike lines 3 through 10.
       On page 289, strike line 25, and insert ``the Corporation, 
     in consultation with the Secretary, deems appropriate.''.
       On page 290, beginning on line 9, strike ``, in 
     consultation with the Secretary and the Council,''.
       On page 290, line 11, insert after the period the 
     following: ``The Corporation shall consult with the Secretary 
     in the development and finalization of such regulations.''.
       On page 295, between lines 19 and 20, insert the following:
       (s) Recoupment of Compensation From Senior Executives and 
     Directors.--
       (1) In general.--The Corporation, as receiver of a covered 
     financial company, may recover from any current or former 
     senior executive or director substantially responsible for 
     the failed condition of the covered financial company any 
     compensation received during the 2-year period preceding the 
     date on which the Corporation was appointed as the receiver 
     of the covered financial company, except that, in the case of 
     fraud, no time limit shall apply.
       (2) Cost considerations.--In seeking to recover any such 
     compensation, the Corporation shall weigh the financial and 
     deterrent benefits of such recovery against the cost of 
     executing the recovery.
       (3) Rulemaking.--The Corporation shall promulgate 
     regulations to implement the requirements of this subsection, 
     including defining the term ``compensation'' to mean any 
     financial remuneration, including salary, bonuses, 
     incentives, benefits, severance, deferred compensation, or 
     golden parachute benefits, and any profits realized from the 
     sale of the securities of the covered financial company.
       On page 296, between lines 15 and 16, insert the following:
       (d) FDIC Inspector General Reviews.--
       (1) Scope.--The Inspector General of the Corporation shall 
     conduct, supervise, and coordinate audits and investigations 
     of the liquidation of any covered financial company by the 
     Corporation as receiver under this title, including 
     collecting and summarizing--
       (A) a description of actions taken by the Corporation as 
     receiver;
       (B) a description of any material sales, transfers, 
     mergers, obligations, purchases, and other material 
     transactions entered into by the Corporation;
       (C) an evaluation of the adequacy of the policies and 
     procedures of the Corporation under section 203(d) and 
     orderly liquidation plan under section 210(n)(14);
       (D) an evaluation of the utilization by the Corporation of 
     the private sector in carrying out its functions, including 
     the adequacy of any conflict-of-interest reviews; and
       (E) an evaluation of the overall performance of the 
     Corporation in liquidating the covered financial company, 
     including administrative costs, timeliness of liquidation 
     process, and impact on the financial system.
       (2) Frequency.--Not later than 6 months after the date of 
     appointment of the Corporation as receiver under this title 
     and every 6 months thereafter, the Inspector General of the 
     Corporation shall conduct the audit and investigation 
     described in paragraph (1).
       (3) Reports and testimony.--The Inspector General of the 
     Corporation shall include in the semiannual reports required 
     by section 5(a) of the Inspector General Act of 1978 (5 
     U.S.C. App.), a summary of the findings and evaluations under 
     paragraph (1), and shall appear before the appropriate 
     committees of Congress, if requested, to present each such 
     report.
       (4) Funding.--
       (A) Initial funding.--The expenses of the Inspector General 
     of the Corporation in carrying out this subsection shall be 
     considered administrative expenses of the receivership.
       (B) Additional funding.--If the maximum amount available to 
     the Corporation as receiver under this title is insufficient 
     to enable the Inspector General of the Corporation to carry 
     out the duties under this subsection, the Corporation shall 
     pay such additional amounts from assessments imposed under 
     section 210.
       (5) Termination of responsibilities.--The duties and 
     responsibilities of the Inspector General of the Corporation 
     under this subsection shall terminate 1 year after the date 
     of termination of the receivership under this title.
       (e) Treasury Inspector General Reviews.--
       (1) Scope.--The Inspector General of the Department of the 
     Treasury shall conduct, supervise, and coordinate audits and 
     investigations of actions taken by the Secretary related to 
     the liquidation of any covered financial company under this 
     title, including collecting and summarizing--
       (A) a description of actions taken by the Secretary under 
     this title;
       (B) an analysis of the approval by the Secretary of the 
     policies and procedures of the Corporation under section 203 
     and acceptance of the orderly liquidation plan of the 
     Corporation under section 210; and
       (C) an assessment of the terms and conditions underlying 
     the purchase by the Secretary of obligations of the 
     Corporation under section 210.
       (2) Frequency.--Not later than 6 months after the date of 
     appointment of the Corporation as receiver under this title 
     and every 6 months thereafter, the Inspector General of the 
     Department of the Treasury shall conduct the audit and 
     investigation described in paragraph (1).
       (3) Reports and testimony.--The Inspector General of the 
     Department of the Treasury shall include in the semiannual 
     reports required by section 5(a) of the Inspector General Act 
     of 1978 (5 U.S.C. App.), a summary of the findings and 
     assessments under paragraph (1), and shall appear before the 
     appropriate committees of Congress, if requested, to present 
     each such report.
       (4) Termination of responsibilities.--The duties and 
     responsibilities of the Inspector General of the Department 
     of the Treasury under this subsection shall terminate 1 year 
     after the date on which the obligations purchased by the 
     Secretary from the Corporation under section 210 are fully 
     redeemed.
       (f) Primary Financial Regulatory Agency Inspector General 
     Reviews.--
       (1) Scope.--Upon the appointment of the Corporation as 
     receiver for a covered financial company supervised by a 
     Federal primary financial regulatory agency or the Board of 
     Governors under section 165, the Inspector General of the 
     agency or the Board of Governors shall make a written report 
     reviewing the supervision by the agency or the Board of 
     Governors of the covered financial company, which shall--
       (A) evaluate the effectiveness of the agency or the Board 
     of Governors in carrying out its supervisory responsibilities 
     with respect to the covered financial company;
       (B) identify any acts or omissions on the part of agency or 
     Board of Governors officials that contributed to the covered 
     financial company being in default or in danger of default;
       (C) identify any actions that could have been taken by the 
     agency or the Board of Governors that would have prevented 
     the company from being in default or in danger of default; 
     and
       (D) recommend appropriate administrative or legislative 
     action.
       (2) Reports and testimony.--Not later than 1 year after the 
     date of appointment of the Corporation as receiver under this 
     title, the Inspector General of the Federal primary financial 
     regulatory agency or the Board of Governors shall provide the 
     report required by paragraph (1) to such agency or the Board 
     of Governors, and along with such agency or the Board of 
     Governors, as applicable, shall appear before the appropriate 
     committees of Congress, if requested, to present the report 
     required by paragraph (1). Not later than 90 days after the 
     date of receipt of the report required by paragraph (1), such 
     agency or the Board of Governors, as applicable, shall 
     provide a written report to Congress describing any actions 
     taken in response to the recommendations in the report, and 
     if no such actions were taken, describing the reasons why no 
     actions were taken.

     SEC. 212. PROHIBITION OF CIRCUMVENTION AND PREVENTION OF 
                   CONFLICTS OF INTEREST.

       (a) No Other Funding.--Funds for the orderly liquidation of 
     any covered financial company under this title shall only be 
     provided as specified under this title.
       (b) Limit on Governmental Actions.--No governmental entity 
     may take any action to circumvent the purposes of this title.

[[Page S3199]]

       (c) Conflict of Interest.--In the event that the 
     Corporation is appointed receiver for more than 1 covered 
     financial company or is appointed receiver for a covered 
     financial company and receiver for any insured depository 
     institution that is an affiliate of such covered financial 
     company, the Corporation shall take appropriate action, as 
     necessary to avoid any conflicts of interest that may arise 
     in connection with multiple receiverships.

     SEC. 213. BAN ON SENIOR EXECUTIVES AND DIRECTORS.

       (a) Prohibition Authority.--The Board of Governors or, if 
     the covered financial company was not supervised by the Board 
     of Governors, the Corporation, may exercise the authority 
     provided by this section.
       (b) Authority To Issue Order.--The appropriate agency 
     described in subsection (a) may take any action authorized by 
     subsection (c), if the agency determines that--
       (1) a senior executive or a director of the covered 
     financial company, prior to the appointment of the 
     Corporation as receiver, has, directly or indirectly--
       (A) violated--
       (i) any law or regulation;
       (ii) any cease-and-desist order which has become final;
       (iii) any condition imposed in writing by a Federal agency 
     in connection with any action on any application, notice, or 
     request by such company or senior executive; or
       (iv) any written agreement between such company and such 
     agency;
       (B) engaged or participated in any unsafe or unsound 
     practice in connection with any financial company; or
       (C) committed or engaged in any act, omission, or practice 
     which constitutes a breach of the fiduciary duty of such 
     senior executive or director;
       (2) by reason of the violation, practice, or breach 
     described in any clause of paragraph (1), such senior 
     executive or director has received financial gain or other 
     benefit by reason of such violation, practice, or breach and 
     such violation, practice, or breach contributed to the 
     failure of the company; and
       (3) such violation, practice, or breach--
       (A) involves personal dishonesty on the part of such senior 
     executive or director; or
       (B) demonstrates willful or continuing disregard by such 
     senior executive or director for the safety or soundness of 
     such company.
       (c) Authorized Actions.--
       (1) In general.--The appropriate agency for a financial 
     company, as described in subsection (a), may serve upon a 
     senior executive or director described in subsection (b) a 
     written notice of the intention of the agency to prohibit any 
     further participation by such person, in any manner, in the 
     conduct of the affairs of any financial company for a period 
     of time determined by the appropriate agency to be 
     commensurate with such violation, practice, or breach, 
     provided such period shall be not less than 2 years.
       (2) Procedures.--The due process requirements and other 
     procedures under section 8(e) of the Federal Deposit 
     Insurance Act shall apply to actions under this section as if 
     the covered financial company were an insured depository 
     institution and the senior executive or director were an 
     institution-affiliated party, as those terms are defined in 
     that Act.
       (d) Regulations.--The Corporation and the Board of 
     Governors, in consultation with the Council, shall jointly 
     prescribe rules or regulations to administer and carry out 
     this section, including rules, regulations, or guidelines to 
     further define the term senior executive for the purposes of 
     this section.
       On page 1522, line 11, strike ``The third'' and insert the 
     following:
       ``(a) Federal Reserve Act.--The third''.
       On page 1528, line 3, strike the end quotation marks and 
     the final period and insert the following:
       ``(E) If an entity to which a Federal reserve bank has 
     provided a loan under this paragraph becomes a covered 
     financial company, as defined in section 203 of the Restoring 
     American Financial Stability Act of 2010, at any time while 
     such loan is outstanding, and the Federal reserve bank incurs 
     a realized net loss on the loan, then the Federal reserve 
     bank shall have a claim equal to the amount of the net 
     realized loss against the covered entity, with the same 
     priority as an obligation to the Secretary of the Treasury 
     under sections 210(n) and 210(o) of the Restoring American 
     Financial Stability Act of 2010.''.
       (b) Conforming Amendment.--Section 507(a)(2) of title 11, 
     United States Code, is amended by inserting ``claims of any 
     Federal reserve bank related to loans made through programs 
     or facilities authorized under the third undesignated 
     paragraph of the Federal Reserve Act ( 12 U.S.C. 343),'' 
     after ``this title,''.
       On page 1523, line 17, strike ``of sufficient quality'' and 
     insert ``sufficient''.
       On page 1523, line 18, insert after the period the 
     following: ``The policies and procedures established by the 
     Board shall require that a Federal reserve bank assign, 
     consistent with sound risk management practices and to ensure 
     protection for the taxpayer, a lendable value to all 
     collateral for a loan executed by a Federal reserve bank 
     under this paragraph in determining whether the loan is 
     secured satisfactorily for purposes of this paragraph.''.
       On page 1523, line 19, strike ``(ii)'' and insert the 
     following:
       ``(ii) The Board shall establish procedures to prohibit 
     borrowing from programs and facilities by borrowers that are 
     insolvent. Such procedures may include a certification from 
     the chief executive officer (or other authorized officer) of 
     the borrower, at the time the borrower initially borrows 
     under the program or facility (with a duty by the borrower to 
     update the certification if the information in the 
     certification materially changes), that the borrower is not 
     insolvent. A borrower shall be considered insolvent for 
     purposes of this subparagraph, if the borrower is in 
     bankruptcy, resolution under title II of the Restoring 
     American Financial Stability Act of 2010, or any other 
     Federal or State insolvency proceeding.
       ``(iii) A program or facility that is structured to remove 
     assets from the balance sheet of a single and specific 
     company, or that is established for the purpose of assisting 
     a single and specific company avoid bankruptcy, resolution 
     under title II of the Restoring American Financial Stability 
     Act of 2010, or any other Federal or State insolvency 
     proceeding, shall not be considered a program or facility 
     with broad-based eligibility.
       ``(iv)''.
       On page 1523, line 18: insert ``and that any such program 
     is terminated in a timely and orderly fashion'' before 
     ``losses''.
       On page 1524, line 11, strike ``assistance,'' and all that 
     follows through line 12 and insert ``assistance.''.
       On page 1525, strike line 21 and all that follows through 
     page 1528, line 3, and insert the following:
       ``(D) The information submitted to Congress under 
     subparagraph (C) related to--
       ``(i) the identity of the participants in an emergency 
     lending program or facility commenced under this paragraph;
       ``(ii) the amounts borrowed by each participant in any such 
     program or facility;
       ``(iii) identifying details concerning the assets or 
     collateral held by, under, or in connection with such a 
     program or facility,
     shall be kept confidential, upon the written request of the 
     Chairman of the Board, in which case such information shall 
     be made available only to the Chairpersons and Ranking 
     Members of the Committees described in subparagraph (C).''.
       On page 1537, line 23, insert before the period the 
     following: ``and a request for approval of such plan''.
       On page 1537, line 23, strike ``Upon'' and all that follows 
     through page 1538, line 6, and insert the following: ``The 
     Corporation shall exercise the authority under this section 
     to issue guarantees up to that specified maximum amount upon 
     passage of the joint resolution of approval, as provided in 
     subsection (d). Absent such approval, the Corporation shall 
     issue no such guarantees.''.
       
       On page 1538, line 16, strike ``Upon'' and all that follows 
     through page 1547, line 6 and insert the following: ``The 
     Corporation shall exercise the authority under this section 
     to issue guarantees up to that specified maximum amount upon 
     passage of the joint resolution of approval, as provided in 
     subsection (d). Absent such approval, the Corporation shall 
     issue no such guarantees.
       ``(d) Resolution of Approval.--
       ``(1) Additional debt guarantee authority.--A request by 
     the President under this section shall be considered granted 
     by Congress upon adoption of a joint resolution approving 
     such request. Such joint resolution shall be considered in 
     the Senate under expedited procedures.
       ``(2) Fast track consideration in senate.--
       ``(A) Reconvening.--Upon receipt of a request under 
     subsection (c), if the Senate has adjourned or recessed for 
     more than 2 days, the majority leader of the Senate, after 
     consultation with the minority leader of the Senate, shall 
     notify the Members of the Senate that, pursuant to this 
     section, the Senate shall convene not later than the second 
     calendar day after receipt of such message.
       ``(B) Placement on calendar.--Upon introduction in the 
     Senate, the joint resolution shall be placed immediately on 
     the calendar.
       ``(C) Floor consideration.--
       ``(i) In general.--Notwithstanding Rule XXII of the 
     Standing Rules of the Senate, it is in order at any time 
     during the period beginning on the 4th day after the date on 
     which Congress receives a request under subsection (c), and 
     ending on the 7th day after that date (even though a previous 
     motion to the same effect has been disagreed to) to move to 
     proceed to the consideration of the joint resolution, and all 
     points of order against the joint resolution (and against 
     consideration of the joint resolution) are waived. The motion 
     to proceed is not debatable. The motion is not subject to a 
     motion to postpone. A motion to reconsider the vote by which 
     the motion is agreed to or disagreed to shall not be in 
     order. If a motion to proceed to the consideration of the 
     resolution is agreed to, the joint resolution shall remain 
     the unfinished business until disposed of.
       ``(ii) Debate.--Debate on the joint resolution, and on all 
     debatable motions and appeals in connection therewith, shall 
     be limited to not more than 10 hours, which shall be divided 
     equally between the majority and minority leaders or their 
     designees. A motion further to limit debate is in order and 
     not debatable. An amendment to, or a motion to postpone, or a 
     motion to proceed to the consideration of other business, or 
     a motion to recommit the joint resolution is not in order.
       ``(iii) Vote on passage.--The vote on passage shall occur 
     immediately following the

[[Page S3200]]

     conclusion of the debate on the joint resolution, and a 
     single quorum call at the conclusion of the debate if 
     requested in accordance with the rules of the Senate.
       ``(iv) Rulings of the chair on procedure.--Appeals from the 
     decisions of the Chair relating to the application of the 
     rules of the Senate, as the case may be, to the procedure 
     relating to a joint resolution shall be decided without 
     debate.
       ``(3) Rules.--
       ``(A) Coordination with action by house of 
     representatives.--If, before the passage by the Senate of a 
     joint resolution of the Senate, the Senate receives a joint 
     resolution, from the House of Representatives, then the 
     following procedures shall apply:
       ``(i) The joint resolution of the House of Representatives 
     shall not be referred to a committee.
       ``(ii) With respect to a joint resolution of the Senate--

       ``(I) the procedure in the Senate shall be the same as if 
     no joint resolution had been received from the other House; 
     but
       ``(II) the vote on passage shall be on the joint resolution 
     of the House of Representatives.

       ``(B) Treatment of joint resolution of house of 
     representatives.--If the Senate fails to introduce or 
     consider a joint resolution under this section, the joint 
     resolution of the House of Representatives shall be entitled 
     to expedited floor procedures under this subsection.
       ``(C) Treatment of companion measures.--If, following 
     passage of the joint resolution in the Senate, the Senate 
     then receives the companion measure from the House of 
     Representatives, the companion measure shall not be 
     debatable.
       ``(D) Rules of the senate.--This subsection is enacted by 
     Congress--
       ``(i) as an exercise of the rulemaking power of the Senate, 
     and as such it is deemed a part of the rules of the Senate, 
     but applicable only with respect to the procedure to be 
     followed in the Senate in the case of a joint resolution, and 
     it supersedes other rules, only to the extent that it is 
     inconsistent with such rules; and
       ``(ii) with full recognition of the constitutional right of 
     the Senate to change the rules (so far as relating to the 
     procedure of the Senate) at any time, in the same manner, and 
     to the same extent as in the case of any other rule of the 
     Senate.
       ``(4) Definition.--As used in this subsection, the term 
     `joint resolution' means only a joint resolution--
       ``(A) that is introduced not later than 3 calendar days 
     after the date on which the request referred to in subsection 
     (c) is received by Congress;
       ``(B) that does not have a preamble;
       ``(C) the title of which is as follows: `Joint resolution 
     relating to the approval of a plan to guarantee obligations 
     under section 1155 of the Restoring American Financial 
     Stability Act of 2010'; and
       ``(D) the matter after the resolving clause of which is as 
     follows: `That Congress approves the obligation of any amount 
     described in section 1155(c) of the Restoring American 
     Financial Stability Act of 2010.'.''.
       On page 1550, strike lines 1 through 12, and insert the 
     following:
       (3) Liquidity event.--The term ``liquidity event'' means--
       (A) an exceptional and broad reduction in the general 
     ability of financial market participants--
       (i) to sell financial assets without an unusual and 
     significant discount; or
       (ii) to borrow using financial assets as collateral without 
     an unusual and significant increase in margin; or
       (B) an unusual and significant reduction in the ability of 
     financial market participants to obtain unsecured credit.
       On page 1550, strike line 24 and all that follows through 
     page 1551, line 3, and insert the following:
       (b) Federal Deposit Insurance Act.--Section 13(c)(4)(G) of 
     the Federal Deposit Insurance Act (12 U.S.C. 1823(c)(4)(G)) 
     is amended--
       (1) in clause (i)--
       (A) in subclause (I), by inserting ``for which the 
     Corporation has been appointed receiver'' before ``would have 
     serious''; and
       (B) in the undesignated matter following subclause (II), by 
     inserting ``for the purpose of winding up the insured 
     depository institution for which the Corporation has been 
     appointed receiver'' after ``provide assistance under this 
     section''; and
       (2) in clause (v)(I), by striking ``The'' and inserting 
     ``Not later than 3 days after making a determination under 
     clause (i), the''.
                                 ______
                                 
  SA 3823. Mr. LEAHY (for himself, Mr. Durbin, Mr. Rockefeller, Mr. 
Schumer, Mrs. Feinstein, Mr. Specter, Mr. Whitehouse, Ms. Cantwell, Mr. 
Kaufman, Mrs. Gillibrand, Mr. Wyden, Mr. Brown of Ohio, Mr. Lieberman, 
Mr. Burris, Mrs. McCaskill, Mr. Franken, Mr. Bennet, Mr. Feingold, Mr. 
Lautenberg, Mr. Webb, Mrs. Boxer, and Ms. Landrieu) submitted an 
amendment intended to be proposed to amendment SA 3739 proposed by Mr. 
Reid (for Mr. Dodd (for himself and Mrs. Lincoln)) to the bill S. 3217, 
to promote the financial stability of the United States by improving 
accountability and transparency in the financial system, to end ``too 
big to fail'', to protect the American taxpayer by ending bailouts, to 
protect consumers from abusive financial services practices, and for 
other purposes; which was ordered to lie on the table; as follows:

       At the end of the amendment, insert the following:

     SEC. ___. HEALTH INSURANCE INDUSTRY ANTITRUST ENFORCEMENT 
                   ACT.

       (a) Short Title.--This section may be cited as the ``Health 
     Insurance Industry Antitrust Enforcement Act''.
       (b) Restoring the Application of Antitrust Laws to Health 
     Sector Insurers.--
       (1) Amendment to mccarran-ferguson act.--Section 3 of the 
     Act of March 9, 1945 (15 U.S.C. 1013), commonly known as the 
     McCarran-Ferguson Act, is amended by adding at the end the 
     following:
       ``(c) Nothing contained in this Act shall modify, impair, 
     or supersede the operation of any of the antitrust laws with 
     respect to the business of health insurance. For purposes of 
     the preceding sentence, the term `antitrust laws' has the 
     meaning given it in subsection (a) of the first section of 
     the Clayton Act, except that such term includes section 5 of 
     the Federal Trade Commission Act to the extent that such 
     section 5 applies to unfair methods of competition.''.
       (2) Related provision.--For purposes of section 5 of the 
     Federal Trade Commission Act (15 U.S.C. 45) to the extent 
     such section applies to unfair methods of competition, 
     section 3(c) of the McCarran-Ferguson Act shall apply with 
     respect to the business of health insurance without regard to 
     whether such business is carried on for profit, 
     notwithstanding the definition of ``Corporation'' contained 
     in section 4 of the Federal Trade Commission Act.
                                 ______
                                 
  SA 3824. Mr. SHELBY submitted an amendment intended to be proposed to 
amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mrs. Lincoln)) to the bill S. 3217, to promote the financial stability 
of the United States by improving accountability and transparency in 
the financial system, to end ``too big to fail'', to protect the 
American taxpayer by ending bailouts, to protect consumers from abusive 
financial services practices, and for other purposes; which was ordered 
to lie on the table; as follows:

       Strike title I and insert the following:

                      TITLE I--FINANCIAL STABILITY

     SEC. 101. SHORT TITLE.

       This title may be cited as the ``Financial Stability Act of 
     2010''.

     SEC. 102. DEFINITIONS.

       (a) In General.--For purposes of this title, unless the 
     context otherwise requires, the following definitions shall 
     apply:
       (1) Bank holding company.--The term ``bank holding 
     company'' has the same meaning as in section 2 of the Bank 
     Holding Company Act of 1956 (12 U.S.C. 1841). A foreign bank 
     or company that is treated as a bank holding company for 
     purposes of the Bank Holding Company Act of 1956, pursuant to 
     section 8(a) of the International Banking Act of 1978 (12 
     U.S.C. 3106(a)), shall be treated as a bank holding company 
     for purposes of this title.
       (2) Chairperson.--The term ``Chairperson'' means the 
     Chairperson of the Council.
       (3) Member agency.--The term ``member agency'' means an 
     agency represented by a voting member of the Council.
       (4) Nonbank financial company definitions.--
       (A) Foreign nonbank financial company.--The term ``foreign 
     nonbank financial company'' means a company (other than a 
     company that is, or is treated in the United States as, a 
     bank holding company or a subsidiary thereof) that is--
       (i) incorporated or organized in a country other than the 
     United States; and
       (ii) substantially engaged in, including through a branch 
     in the United States, activities in the United States that 
     are financial in nature (as defined in section 4(k) of the 
     Bank Holding Company Act of 1956).
       (B) U.S. nonbank financial company.--The term ``U.S. 
     nonbank financial company'' means a company (other than a 
     bank holding company or a subsidiary thereof, or a Farm 
     Credit System institution chartered and subject to the 
     provisions of the Farm Credit Act of 1971 (12 U.S.C. 2001 et. 
     seq.)) that is--
       (i) incorporated or organized under the laws of the United 
     States or any State; and
       (ii) substantially engaged in activities in the United 
     States that are financial in nature (as defined in section 
     4(k) of the Bank Holding Company Act of 1956).
       (C) Nonbank financial company.--The term ``nonbank 
     financial company'' means a U.S. nonbank financial company 
     and a foreign nonbank financial company.
       (D) Nonbank financial company supervised by the board of 
     governors.--The term ``nonbank financial company supervised 
     by the Board of Governors'' means a nonbank financial company 
     that the Council has determined under section 113 shall be 
     supervised by the Board of Governors.
       (5) Significant institutions.--The terms ``significant 
     nonbank financial company'' and ``significant bank holding 
     company'' have the meanings given those terms by rule of the 
     Board of Governors.
       (b) Definitional Criteria.--The Board of Governors shall 
     establish, by regulation, the

[[Page S3201]]

     criteria to determine whether a company is substantially 
     engaged in activities in the United States that are financial 
     in nature (as defined in section 4(k) of the Bank Holding 
     Company Act of 1956) for purposes of the definitions of the 
     terms ``U.S. nonbank financial company'' and ``foreign 
     nonbank financial company'' under subsection (a)(4).
       (c) Foreign Nonbank Financial Companies.--For purposes of 
     the authority of the Board of Governors under this title with 
     respect to foreign nonbank financial companies, references in 
     this title to ``company'' or ``subsidiary'' include only the 
     United States activities and subsidiaries of such foreign 
     company.

           Subtitle A--Financial Stability Oversight Council

     SEC. 111. FINANCIAL STABILITY OVERSIGHT COUNCIL ESTABLISHED.

       (a) Establishment.--Effective on the date of enactment of 
     this Act, there is established the Financial Stability 
     Oversight Council.
       (b) Membership.--The Council shall consist of the following 
     members, who shall each have 1 vote on the Council shall be:
       (1) The Secretary of the Treasury, who shall serve as 
     Chairperson of the Council.
       (2) The Chairman of the Board of Governors.
       (3) The Comptroller of the Currency.
       (4) The Director of the Bureau.
       (5) The Chairman of the Commission.
       (6) The Chairperson of the Corporation.
       (7) The Chairperson of the Commodity Futures Trading 
     Commission.
       (8) The Director of the Federal Housing Finance Agency.
       (9) An independent member appointed by the President, by 
     and with the advice and consent of the Senate, having 
     insurance expertise.
       (c) Terms; Vacancy.--
       (1) Terms.--The independent member of the Council shall 
     serve for a term of 6 years.
       (2) Vacancy.--Any vacancy on the Council shall be filled in 
     the manner in which the original appointment was made.
       (3) Acting officials may serve.--In the event of a vacancy 
     in the office of the head of a member agency or department, 
     and pending the appointment of a successor, or during the 
     absence or disability of the head of a member agency or 
     department, the acting head of the member agency or 
     department shall serve as a member of the Council in the 
     place of that agency or department head.
       (d) Technical and Professional Advisory Committees.--The 
     Council may appoint such special advisory, technical, or 
     professional committees as may be useful in carrying out the 
     functions of the Council, including an advisory committee 
     consisting of State regulators, and the members of such 
     committees may be members of the Council, or other persons, 
     or both.
       (e) Meetings.--
       (1) Timing.--The Council shall meet at the call of the 
     Chairperson or a majority of the members then serving, but 
     not less frequently than quarterly.
       (2) Rules for conducting business.--The Council shall adopt 
     such rules as may be necessary for the conduct of the 
     business of the Council. Such rules shall be rules of agency 
     organization, procedure, or practice for purposes of section 
     553 of title 5, United States Code.
       (f) Voting.--Unless otherwise specified, the Council shall 
     make all decisions that it is authorized or required to make 
     by a majority vote of the members then serving.
       (g) Nonapplicability of FACA.--The Federal Advisory 
     Committee Act (5 U.S.C. App.) shall not apply to the Council, 
     or to any special advisory, technical, or professional 
     committee appointed by the Council, except that, if an 
     advisory, technical, or professional committee has one or 
     more members who are not employees of or affiliated with the 
     United States Government, the Council shall publish a list of 
     the names of the members of such committee.
       (h) Assistance From Federal Agencies.--Any department or 
     agency of the United States may provide to the Council and 
     any special advisory, technical, or professional committee 
     appointed by the Council, such services, funds, facilities, 
     staff, and other support services as the Council may 
     determine advisable.
       (i) Compensation of Members.--
       (1) Federal employee members.--All members of the Council 
     who are officers or employees of the United States shall 
     serve without compensation in addition to that received for 
     their services as officers or employees of the United States.
       (2) Compensation for non-federal member.--Section 5314 of 
     title 5, United States Code, is amended by adding at the end 
     the following:
       ``Independent Member of the Financial Stability Oversight 
     Council (1).''.
       (j) Detail of Government Employees.--Any employee of the 
     Federal Government may be detailed to the Council without 
     reimbursement, and such detail shall be without interruption 
     or loss of civil service status or privilege. An employee of 
     the Federal Government detailed to the Council shall report 
     to and be subject to oversight by the Council during the 
     assignment to the Council, and shall be compensated by the 
     department or agency from which the employee was detailed.

     SEC. 112. COUNCIL AUTHORITY.

       (a) Purposes and Duties of the Council.--
       (1) In general.--The purposes of the Council are--
       (A) to identify risks to the financial stability of the 
     United States that could arise from the material financial 
     distress or failure of large, interconnected bank holding 
     companies or nonbank financial companies;
       (B) to promote market discipline, by eliminating 
     expectations on the part of shareholders, creditors, and 
     counterparties of such companies that the Government will 
     shield them from losses in the event of failure; and
       (C) to respond to emerging threats to the stability of the 
     United States financial markets.
       (2) Duties.--The Council shall, in accordance with this 
     title--
       (A) collect information from member agencies and other 
     Federal and State financial regulatory agencies to assess 
     risks to the United States financial system;
       (B) monitor the financial services marketplace in order to 
     identify potential threats to the financial stability of the 
     United States;
       (C) facilitate information sharing and coordination among 
     the member agencies and other Federal and State agencies 
     regarding domestic financial services policy development, 
     rulemaking, examinations, reporting requirements, and 
     enforcement actions;
       (D) recommend to the member agencies general supervisory 
     priorities and principles reflecting the outcome of 
     discussions among the member agencies;
       (E) identify gaps in regulation that could pose risks to 
     the financial stability of the United States;
       (F) require supervision by the Board of Governors for 
     nonbank financial companies that may pose risks to the 
     financial stability of the United States in the event of 
     their material financial distress or failure, pursuant to 
     section 113;
       (G) make recommendations to the Board of Governors 
     concerning the establishment of heightened prudential 
     standards for risk-based capital, leverage, liquidity, 
     contingent capital, resolution plans and credit exposure 
     reports, concentration limits, enhanced public disclosures, 
     and overall risk management for nonbank financial companies 
     and large, interconnected bank holding companies supervised 
     by the Board of Governors;
       (H) identify systemically important financial market 
     utilities and payment, clearing, and settlement activities 
     (as that term is defined in title VIII), and require such 
     utilities and activities to be subject to standards 
     established by the Board of Governors;
       (I) make recommendations to primary financial regulatory 
     agencies to apply new or heightened standards and safeguards 
     for financial activities or practices that could create or 
     increase risks of significant liquidity, credit, or other 
     problems spreading among bank holding companies, nonbank 
     financial companies, and United States financial markets;
       (J) make determinations regarding exemptions in title VII, 
     where necessary;
       (K) provide a forum for--
       (i) discussion and analysis of emerging market developments 
     and financial regulatory issues; and
       (ii) resolution of jurisdictional disputes among the 
     members of the Council; and
       (L) annually report to and testify before Congress on--
       (i) the activities of the Council;
       (ii) significant financial market developments and 
     potential emerging threats to the financial stability of the 
     United States;
       (iii) all determinations made under section 113 or title 
     VIII, and the basis for such determinations; and
       (iv) recommendations--

       (I) to enhance the integrity, efficiency, competitiveness, 
     and stability of United States financial markets;
       (II) to promote market discipline; and
       (III) to maintain investor confidence.

       (b) Authority To Obtain Information.--
       (1) In general.--The Council may receive, and may request 
     the submission of, any data or information from member 
     agencies, as necessary to monitor the financial services 
     marketplace to identify potential risks to the financial 
     stability of the United States.
       (2) Submissions by the office and member agencies.--
     Notwithstanding any other provision of law any member 
     agencies are authorized to submit information to the Council.
       (3) Back-up examination by the board of governors.--If the 
     Council is unable to determine whether the financial 
     activities of a nonbank financial company pose a threat to 
     the financial stability of the United States, based on 
     discussions with management and publicly available 
     information, the Council may request the Board of Governors, 
     and the Board of Governors is authorized, to conduct an 
     examination of the nonbank financial company for the sole 
     purpose of determining whether the nonbank financial company 
     should be supervised by the Board of Governors for purposes 
     of this title.
       (4) Confidentiality.--
       (A) In general.--The Council and the member agencies shall 
     maintain the confidentiality of any data, information, and 
     reports submitted under this subsection and subtitle B.
       (B) Retention of privilege.--The submission of any 
     nonpublicly available data or information under this 
     subsection shall not constitute a waiver of, or otherwise 
     affect, any privilege arising under Federal or State law 
     (including the rules of any Federal or State court) to which 
     the data or information is otherwise subject.
       (C) Freedom of information act.--Section 552 of title 5, 
     United States Code, including the exceptions thereunder, 
     shall apply to any

[[Page S3202]]

     data or information submitted under this subsection and 
     subtitle B.

     SEC. 113. AUTHORITY TO REQUIRE SUPERVISION AND REGULATION OF 
                   CERTAIN NONBANK FINANCIAL COMPANIES.

       (a) U.S. Nonbank Financial Companies Supervised by the 
     Board of Governors.--
       (1) Determination.--The Council, on a nondelegable basis 
     and by a vote of not fewer than \2/3\ of the members then 
     serving, including an affirmative vote by the Chairperson, 
     may determine that a U.S. nonbank financial company shall be 
     supervised by the Board of Governors and shall be subject to 
     prudential standards, in accordance with this title, if the 
     Council determines that material financial distress at the 
     U.S. nonbank financial company would pose a threat to the 
     financial stability of the United States.
       (2) Considerations.--Each determination under paragraph (1) 
     shall be based on a consideration by the Council of--
       (A) the degree of leverage of the company;
       (B) the amount and nature of the financial assets of the 
     company;
       (C) the amount and types of the liabilities of the company, 
     including the degree of reliance on short-term funding;
       (D) the extent and types of the off-balance-sheet exposures 
     of the company;
       (E) the extent and types of the transactions and 
     relationships of the company with other significant nonbank 
     financial companies and significant bank holding companies;
       (F) the importance of the company as a source of credit for 
     households, businesses, and State and local governments and 
     as a source of liquidity for the United States financial 
     system;
       (G) the recommendation, if any, of a member of the Council;
       (H) the operation of, or ownership interest in, any 
     clearing, settlement, or payment business of the company;
       (I) the extent to which--
       (i) assets are managed rather than owned by the company; 
     and
       (ii) ownership of assets under management is diffuse; and
       (J) any other factors that the Council deems appropriate.
       (b) Foreign Nonbank Financial Companies Supervised by the 
     Board of Governors.--
       (1) Determination.--The Council, on a nondelegable basis 
     and by a vote of not fewer than \2/3\ of the members then 
     serving, including an affirmative vote by the Chairperson, 
     may determine that a foreign nonbank financial company that 
     has substantial assets or operations in the United States 
     shall be supervised by the Board of Governors and shall be 
     subject to prudential standards in accordance with this 
     title, if the Council determines that material financial 
     distress at the foreign nonbank financial company would pose 
     a threat to the financial stability of the United States.
       (2) Considerations.--Each determination under paragraph (1) 
     shall be based on a consideration by the Council of--
       (A) the degree of leverage of the company;
       (B) the amount and nature of the United States financial 
     assets of the company;
       (C) the amount and types of the liabilities of the company 
     used to fund activities and operations in the United States, 
     including the degree of reliance on short-term funding;
       (D) the extent of the United States-related off-balance-
     sheet exposure of the company;
       (E) the extent and type of the transactions and 
     relationships of the company with other significant nonbank 
     financial companies and bank holding companies;
       (F) the importance of the company as a source of credit for 
     United States households, businesses, and State and local 
     governments, and as a source of liquidity for the United 
     States financial system;
       (G) the recommendation, if any, of a member of the Council;
       (H) the extent to which--
       (i) assets are managed rather than owned by the company; 
     and
       (ii) ownership of assets under management is diffuse; and
       (I) any other factors that the Council deems appropriate.
       (c) Reevaluation and Rescission.--The Council shall--
       (1) not less frequently than annually, reevaluate each 
     determination made under subsections (a) and (b) with respect 
     to each nonbank financial company supervised by the Board of 
     Governors; and
       (2) rescind any such determination, if the Council, by a 
     vote of not fewer than \2/3\ of the members then serving, 
     including an affirmative vote by the Chairperson, determines 
     that the nonbank financial company no longer meets the 
     standards under subsection (a) or (b), as applicable.
       (d) Notice and Opportunity for Hearing and Final 
     Determination.--
       (1) In general.--The Council shall provide to a nonbank 
     financial company written notice of a proposed determination 
     of the Council, including an explanation of the basis of the 
     proposed determination of the Council, that such nonbank 
     financial company shall be supervised by the Board of 
     Governors and shall be subject to prudential standards in 
     accordance with this title.
       (2) Hearing.--Not later than 30 days after the date of 
     receipt of any notice of a proposed determination under 
     paragraph (1), the nonbank financial company may request, in 
     writing, an opportunity for a written or oral hearing before 
     the Council to contest the proposed determination. Upon 
     receipt of a timely request, the Council shall fix a time 
     (not later than 30 days after the date of receipt of the 
     request) and place at which such company may appear, 
     personally or through counsel, to submit written materials 
     (or, at the sole discretion of the Council, oral testimony 
     and oral argument).
       (3) Final determination.--Not later than 60 days after the 
     date of a hearing under paragraph (2), the Council shall 
     notify the nonbank financial company of the final 
     determination of the Council, which shall contain a statement 
     of the basis for the decision of the Council.
       (4) No hearing requested.--If a nonbank financial company 
     does not make a timely request for a hearing, the Council 
     shall notify the nonbank financial company, in writing, of 
     the final determination of the Council under subsection (a) 
     or (b), as applicable, not later than 10 days after the date 
     by which the company may request a hearing under paragraph 
     (2).
       (e) Emergency Exception.--
       (1) In general.--The Council may waive or modify the 
     requirements of subsection (d) with respect to a nonbank 
     financial company, if the Council determines, by a vote of 
     not fewer than \2/3\ of the members then serving, including 
     an affirmative vote by the Chairperson, that such waiver or 
     modification is necessary or appropriate to prevent or 
     mitigate threats posed by the nonbank financial company to 
     the financial stability of the United States.
       (2) Notice.--The Council shall provide notice of a waiver 
     or modification under this paragraph to the nonbank financial 
     company concerned as soon as practicable, but not later than 
     24 hours after the waiver or modification is granted.
       (3) Opportunity for hearing.--The Council shall allow a 
     nonbank financial company to request, in writing, an 
     opportunity for a written or oral hearing before the Council 
     to contest a waiver or modification under this paragraph, not 
     later than 10 days after the date of receipt of notice of the 
     waiver or modification by the company. Upon receipt of a 
     timely request, the Council shall fix a time (not later than 
     15 days after the date of receipt of the request) and place 
     at which the nonbank financial company may appear, personally 
     or through counsel, to submit written materials (or, at the 
     sole discretion of the Council, oral testimony and oral 
     argument).
       (4) Notice of final determination.--Not later than 30 days 
     after the date of any hearing under paragraph (3), the 
     Council shall notify the subject nonbank financial company of 
     the final determination of the Council under this paragraph, 
     which shall contain a statement of the basis for the decision 
     of the Council.
       (f) Consultation.--The Council shall consult with the 
     primary financial regulatory agency, if any, for each nonbank 
     financial company or subsidiary of a nonbank financial 
     company that is being considered for supervision by the Board 
     of Governors under this section before the Council makes any 
     final determination with respect to such nonbank financial 
     company under subsection (a), (b), or (c).
       (g) Judicial Review.--If the Council makes a final 
     determination under this section with respect to a nonbank 
     financial company, such nonbank financial company may, not 
     later than 30 days after the date of receipt of the notice of 
     final determination under subsection (d)(3) or (e)(4), bring 
     an action in the United States district court for the 
     judicial district in which the home office of such nonbank 
     financial company is located, or in the United States 
     District Court for the District of Columbia, for an order 
     requiring that the final determination be rescinded, and the 
     court shall, upon review, dismiss such action or direct the 
     final determination to be rescinded. Review of such an action 
     shall be limited to whether the final determination made 
     under this section was arbitrary and capricious.

     SEC. 114. REGISTRATION OF NONBANK FINANCIAL COMPANIES 
                   SUPERVISED BY THE BOARD OF GOVERNORS.

       Not later than 180 days after the date of a final Council 
     determination under section 113 that a nonbank financial 
     company is to be supervised by the Board of Governors, such 
     company shall register with the Board of Governors, on forms 
     prescribed by the Board of Governors, which shall include 
     such information as the Board of Governors, in consultation 
     with the Council, may deem necessary or appropriate to carry 
     out this title.

     SEC. 115. ENHANCED SUPERVISION AND PRUDENTIAL STANDARDS FOR 
                   NONBANK FINANCIAL COMPANIES SUPERVISED BY THE 
                   BOARD OF GOVERNORS AND CERTAIN BANK HOLDING 
                   COMPANIES.

       (a) In General.--
       (1) Purpose.--In order to prevent or mitigate risks to the 
     financial stability of the United States that could arise 
     from the material financial distress or failure of large, 
     interconnected financial institutions, the Council may make 
     recommendations to the Board of Governors concerning the 
     establishment and refinement of prudential standards and 
     reporting and disclosure requirements applicable to nonbank 
     financial companies supervised by the Board of Governors and 
     large, interconnected bank holding companies, that--
       (A) are more stringent than those applicable to other 
     nonbank financial companies and bank holding companies that 
     do not present similar risks to the financial stability of 
     the United States; and

[[Page S3203]]

       (B) increase in stringency, based on the considerations 
     identified in subsection (b)(3).
       (2) Limitation on bank holding companies.--Any standards 
     recommended under subsections (b) through (f) shall not apply 
     to any bank holding company with total consolidated assets of 
     less than $50,000,000,000. The Council may recommend an asset 
     threshold greater than $50,000,000,000 for the applicability 
     of any particular standard under those subsections.
       (b) Development of Prudential Standards.--
       (1) In general.--The recommendations of the Council under 
     subsection (a) may include--
       (A) risk-based capital requirements;
       (B) leverage limits;
       (C) liquidity requirements;
       (D) resolution plan and credit exposure report 
     requirements;
       (E) concentration limits;
       (F) a contingent capital requirement;
       (G) enhanced public disclosures; and
       (H) overall risk management requirements.
       (2) Prudential standards for foreign financial companies.--
     In making recommendations concerning the standards set forth 
     in paragraph (1) that would apply to foreign nonbank 
     financial companies supervised by the Board of Governors or 
     foreign-based bank holding companies, the Council shall give 
     due regard to the principle of national treatment and 
     competitive equity.
       (3) Considerations.--In making recommendations concerning 
     prudential standards under paragraph (1), the Council shall--
       (A) take into account differences among nonbank financial 
     companies supervised by the Board of Governors and bank 
     holding companies described in subsection (a), based on--
       (i) the factors described in subsections (a) and (b) of 
     section 113;
       (ii) whether the company owns an insured depository 
     institution;
       (iii) nonfinancial activities and affiliations of the 
     company; and
       (iv) any other factors that the Council determines 
     appropriate; and
       (B) to the extent possible, ensure that small changes in 
     the factors listed in subsections (a) and (b) of section 113 
     would not result in sharp, discontinuous changes in the 
     prudential standards established under paragraph (1).
       (c) Contingent Capital.--
       (1) Study required.--The Council shall conduct a study of 
     the feasibility, benefits, costs, and structure of a 
     contingent capital requirement for nonbank financial 
     companies supervised by the Board of Governors and bank 
     holding companies described in subsection (a), which study 
     shall include--
       (A) an evaluation of the degree to which such requirement 
     would enhance the safety and soundness of companies subject 
     to the requirement, promote the financial stability of the 
     United States, and reduce risks to United States taxpayers;
       (B) an evaluation of the characteristics and amounts of 
     convertible debt that should be required;
       (C) an analysis of potential prudential standards that 
     should be used to determine whether the contingent capital of 
     a company would be converted to equity in times of financial 
     stress;
       (D) an evaluation of the costs to companies, the effects on 
     the structure and operation of credit and other financial 
     markets, and other economic effects of requiring contingent 
     capital;
       (E) an evaluation of the effects of such requirement on the 
     international competitiveness of companies subject to the 
     requirement and the prospects for international coordination 
     in establishing such requirement; and
       (F) recommendations for implementing regulations.
       (2) Report.--The Council shall submit a report to Congress 
     regarding the study required by paragraph (1) not later than 
     2 years after the date of enactment of this Act.
       (3) Recommendations.--
       (A) In general.--Subsequent to submitting a report to 
     Congress under paragraph (2), the Council may make 
     recommendations to the Board of Governors to require any 
     nonbank financial company supervised by the Board of 
     Governors and any bank holding company described in 
     subsection (a) to maintain a minimum amount of long-term 
     hybrid debt that is convertible to equity in times of 
     financial stress.
       (B) Factors to consider.--In making recommendations under 
     this subsection, the Council shall consider--
       (i) an appropriate transition period for implementation of 
     a conversion under this subsection;
       (ii) the factors described in subsection (b)(3);
       (iii) capital requirements applicable to a nonbank 
     financial company supervised by the Board of Governors or a 
     bank holding company described in subsection (a), and 
     subsidiaries thereof;
       (iv) results of the study required by paragraph (1); and
       (v) any other factor that the Council deems appropriate.
       (d) Resolution Plan and Credit Exposure Reports.--
       (1) Resolution plan.--The Council may make recommendations 
     to the Board of Governors concerning the requirement that 
     each nonbank financial company supervised by the Board of 
     Governors and each bank holding company described in 
     subsection (a) report periodically to the Council, the Board 
     of Governors, and the Corporation, the plan of such company 
     for rapid and orderly resolution in the event of material 
     financial distress or failure.
       (2) Credit exposure report.--The Council may make 
     recommendations to the Board of Governors concerning the 
     advisability of requiring each nonbank financial company 
     supervised by the Board of Governors and bank holding company 
     described in subsection (a) to report periodically to the 
     Council, the Board of Governors, and the Corporation on--
       (A) the nature and extent to which the company has credit 
     exposure to other significant nonbank financial companies and 
     significant bank holding companies; and
       (B) the nature and extent to which other such significant 
     nonbank financial companies and significant bank holding 
     companies have credit exposure to that company.
       (e) Concentration Limits.--In order to limit the risks that 
     the failure of any individual company could pose to nonbank 
     financial companies supervised by the Board of Governors or 
     bank holding companies described in subsection (a), the 
     Council may make recommendations to the Board of Governors to 
     prescribe standards to limit such risks, as set forth in 
     section 165.
       (f) Enhanced Public Disclosures.--The Council may make 
     recommendations to the Board of Governors to require periodic 
     public disclosures by bank holding companies described in 
     subsection (a) and by nonbank financial companies supervised 
     by the Board of Governors, in order to support market 
     evaluation of the risk profile, capital adequacy, and risk 
     management capabilities thereof.

     SEC. 116. REPORTS.

       (a) In General.--Subject to subsection (b), the Council may 
     require a bank holding company with total consolidated assets 
     of $50,000,000,000 or greater or a nonbank financial company 
     supervised by the Board of Governors, and any subsidiary 
     thereof, to submit certified reports to keep the Council 
     informed as to--
       (1) the financial condition of the company;
       (2) systems for monitoring and controlling financial, 
     operating, and other risks;
       (3) transactions with any subsidiary that is a depository 
     institution; and
       (4) the extent to which the activities and operations of 
     the company and any subsidiary thereof, could, under adverse 
     circumstances, have the potential to disrupt financial 
     markets or affect the overall financial stability of the 
     United States.
       (b) Use of Existing Reports.--
       (1) In general.--For purposes of compliance with subsection 
     (a), the Council shall, to the fullest extent possible, use--
       (A) reports that a bank holding company, nonbank financial 
     company supervised by the Board of Governors, or any 
     functionally regulated subsidiary of such company has been 
     required to provide to other Federal or State regulatory 
     agencies;
       (B) information that is otherwise required to be reported 
     publicly; and
       (C) externally audited financial statements.
       (2) Availability.--Each bank holding company described in 
     subsection (a) and nonbank financial company supervised by 
     the Board of Governors, and any subsidiary thereof, shall 
     provide to the Council, at the request of the Council, copies 
     of all reports referred to in paragraph (1).
       (3) Confidentiality.--The Council shall maintain the 
     confidentiality of the reports obtained under subsection (a) 
     and paragraph (1)(A) of this subsection.

     SEC. 117. TREATMENT OF CERTAIN COMPANIES THAT CEASE TO BE 
                   BANK HOLDING COMPANIES.

       (a) Applicability.--This section shall apply to any entity 
     or a successor entity that--
       (1) was a bank holding company having total consolidated 
     assets equal to or greater than $50,000,000,000 as of January 
     1, 2010; and
       (2) received financial assistance under or participated in 
     the Capital Purchase Program established under the Troubled 
     Asset Relief Program authorized by the Emergency Economic 
     Stabilization Act of 2008.
       (b) Treatment.--If an entity described in subsection (a) 
     ceases to be a bank holding company at any time after January 
     1, 2010, then such entity shall be treated as a nonbank 
     financial company supervised by the Board of Governors, as if 
     the Council had made a determination under section 113 with 
     respect to that entity.
       (c) Appeal.--
       (1) Request for hearing.--An entity may request, in 
     writing, an opportunity for a written or oral hearing before 
     the Council to appeal its treatment as a nonbank financial 
     company supervised by the Board of Governors in accordance 
     with this section. Upon receipt of the request, the Council 
     shall fix a time (not later than 30 days after the date of 
     receipt of the request) and place at which such entity may 
     appear, personally or through counsel, to submit written 
     materials (or, at the sole discretion of the Council, oral 
     testimony and oral argument).
       (2) Decision.--
       (A) Proposed decision.--Not later than 60 days after the 
     date of a hearing under paragraph (1), the Council shall 
     submit a report to, and may testify before, the Committee on 
     Banking, Housing, and Urban Affairs of the Senate and the 
     Committee on Financial Services of the House of 
     Representatives on

[[Page S3204]]

     the proposed decision of the Council regarding an appeal 
     under paragraph (1), which report shall include a statement 
     of the basis for the proposed decision of the Council.
       (B) Notice of final decision.--The Council shall notify the 
     subject entity of the final decision of the Council regarding 
     an appeal under paragraph (1), which notice shall contain a 
     statement of the basis for the final decision of the Council, 
     not later than 60 days after the later of--
       (i) the date of the submission of the report under 
     subparagraph (A); or
       (ii) if the Committee on Banking, Housing, and Urban 
     Affairs of the Senate or the Committee on Financial Services 
     of the House of Representatives holds one or more hearings 
     regarding such report, the date of the last such hearing.
       (C) Considerations.--In making a decision regarding an 
     appeal under paragraph (1), the Council shall consider 
     whether the company meets the standards under section 113(a) 
     or 113(b), as applicable, and the definition of the term 
     ``nonbank financial company'' under section 102. The decision 
     of the Council shall be final, subject to the review under 
     paragraph (3).
       (3) Review.--If the Council denies an appeal under this 
     subsection, the Council shall, not less frequently than 
     annually, review and reevaluate the decision.

     SEC. 118. COUNCIL FUNDING.

       Any expenses of the Council shall be treated as expenses 
     of, and paid by, the Department of the Treasury.

     SEC. 119. RESOLUTION OF SUPERVISORY JURISDICTIONAL DISPUTES 
                   AMONG MEMBER AGENCIES.

       (a) Request for Dispute Resolution.--The Council shall 
     resolve a dispute among 2 or more member agencies, if--
       (1) a member agency has a dispute with another member 
     agency about the respective jurisdiction over a particular 
     bank holding company, nonbank financial company, or financial 
     activity or product (excluding matters for which another 
     dispute mechanism specifically has been provided under 
     Federal law);
       (2) the Council determines that the disputing agencies 
     cannot, after a demonstrated good faith effort, resolve the 
     dispute without the intervention of the Council; and
       (3) any of the member agencies involved in the dispute--
       (A) provides all other disputants prior notice of the 
     intent to request dispute resolution by the Council; and
       (B) requests in writing, not earlier than 14 days after 
     providing the notice described in subparagraph (A), that the 
     Council resolve the dispute.
       (b) Council Decision.--The Council shall resolve each 
     dispute described in subsection (a)--
       (1) within a reasonable time after receiving the dispute 
     resolution request;
       (2) after consideration of relevant information provided by 
     each agency party to the dispute; and
       (3) by agreeing with 1 of the disputants regarding the 
     entirety of the matter, or by determining a compromise 
     position.
       (c) Form and Binding Effect.--A Council decision under this 
     section shall--
       (1) be in writing;
       (2) include an explanation of the reasons therefor; and
       (3) be binding on all Federal agencies that are parties to 
     the dispute.

     SEC. 120. ADDITIONAL STANDARDS APPLICABLE TO ACTIVITIES OR 
                   PRACTICES FOR FINANCIAL STABILITY PURPOSES.

       (a) In General.--The Council may issue recommendations to 
     the primary financial regulatory agencies to apply new or 
     heightened standards and safeguards, including standards 
     enumerated in section 115, for a financial activity or 
     practice conducted by bank holding companies or nonbank 
     financial companies under their respective jurisdictions, if 
     the Council determines that the conduct of such activity or 
     practice could create or increase the risk of significant 
     liquidity, credit, or other problems spreading among bank 
     holding companies and nonbank financial companies or the 
     financial markets of the United States.
       (b) Procedure for Recommendations to Regulators.--
       (1) Notice and opportunity for comment.--The Council shall 
     consult with the primary financial regulatory agencies and 
     provide notice to the public and opportunity for comment for 
     any proposed recommendation that the primary financial 
     regulatory agencies apply new or heightened standards and 
     safeguards for a financial activity or practice.
       (2) Criteria.--The new or heightened standards and 
     safeguards for a financial activity or practice recommended 
     under paragraph (1)--
       (A) shall take costs to long-term economic growth into 
     account; and
       (B) may include prescribing the conduct of the activity or 
     practice in specific ways (such as by limiting its scope, or 
     applying particular capital or risk management requirements 
     to the conduct of the activity) or prohibiting the activity 
     or practice.
       (c) Implementation of Recommended Standards.--
       (1) Role of primary financial regulatory agency.--
       (A) In general.--Each primary financial regulatory agency 
     may impose, require reports regarding, examine for compliance 
     with, and enforce standards in accordance with this section 
     with respect to those entities for which it is the primary 
     financial regulatory agency.
       (B) Rule of construction.--The authority under this 
     paragraph is in addition to, and does not limit, any other 
     authority of a primary financial regulatory agency. 
     Compliance by an entity with actions taken by a primary 
     financial regulatory agency under this section shall be 
     enforceable in accordance with the statutes governing the 
     respective jurisdiction of the primary financial regulatory 
     agency over the entity, as if the agency action were taken 
     under those statutes.
       (2) Imposition of standards.--The primary financial 
     regulatory agency shall impose the standards recommended by 
     the Council in accordance with subsection (a), or similar 
     standards that the Council deems acceptable, or shall explain 
     in writing to the Council, not later than 90 days after the 
     date on which the Council issues the recommendation, why the 
     agency has determined not to follow the recommendation of the 
     Council.
       (d) Report to Congress.--The Council shall report to 
     Congress on--
       (1) any recommendations issued by the Council under this 
     section;
       (2) the implementation of, or failure to implement such 
     recommendation on the part of a primary financial regulatory 
     agency; and
       (3) in any case in which no primary financial regulatory 
     agency exists for the nonbank financial company conducting 
     financial activities or practices referred to in subsection 
     (a), recommendations for legislation that would prevent such 
     activities or practices from threatening the stability of the 
     financial system of the United States.
       (e) Effect of Rescission of Identification.--
       (1) Notice.--The Council may recommend to the relevant 
     primary financial regulatory agency that a financial activity 
     or practice no longer requires any standards or safeguards 
     implemented under this section.
       (2) Determination of primary financial regulatory agency to 
     continue.--
       (A) In general.--Upon receipt of a recommendation under 
     paragraph (1), a primary financial regulatory agency that has 
     imposed standards under this section shall determine whether 
     standards that it has imposed under this section should 
     remain in effect.
       (B) Appeal process.--Each primary financial regulatory 
     agency that has imposed standards under this section shall 
     promulgate regulations to establish a procedure under which 
     entities under its jurisdiction may appeal a determination by 
     such agency under this paragraph that standards imposed under 
     this section should remain in effect.

     SEC. 121. MITIGATION OF RISKS TO FINANCIAL STABILITY.

       (a) Mitigatory Actions.--If the Board of Governors 
     determines that a bank holding company with total 
     consolidated assets of $50,000,000,000 or more, or a nonbank 
     financial company supervised by the Board of Governors, poses 
     a grave threat to the financial stability of the United 
     States, the Board of Governors, upon an affirmative vote of 
     not fewer than \2/3\ of the Council members then serving, 
     shall require the subject company--
       (1) to terminate one or more activities;
       (2) to impose conditions on the manner in which the company 
     conducts one or more activities; or
       (3) if the Board of Governors determines that such action 
     is inadequate to mitigate a threat to the financial stability 
     of the United States in its recommendation, to sell or 
     otherwise transfer assets or off-balance-sheet items to 
     unaffiliated entities.
       (b) Notice and Hearing.--
       (1) In general.--The Board of Governors, in consultation 
     with the Council, shall provide to a company described in 
     subsection (a) written notice that such company is being 
     considered for mitigatory action pursuant to this section, 
     including an explanation of the basis for, and description 
     of, the proposed mitigatory action.
       (2) Hearing.--Not later than 30 days after the date of 
     receipt of notice under paragraph (1), the company may 
     request, in writing, an opportunity for a written or oral 
     hearing before the Board of Governors to contest the proposed 
     mitigatory action. Upon receipt of a timely request, the 
     Board of Governors shall fix a time (not later than 30 days 
     after the date of receipt of the request) and place at which 
     such company may appear, personally or through counsel, to 
     submit written materials (or, at the discretion of the Board 
     of Governors, in consultation with the Council, oral 
     testimony and oral argument).
       (3) Decision.--Not later than 60 days after the date of a 
     hearing under paragraph (2), or not later than 60 days after 
     the provision of a notice under paragraph (1) if no hearing 
     was held, the Board of Governors shall notify the company of 
     the final decision of the Board of Governors, including the 
     results of the vote of the Council, as described in 
     subsection (a).
       (c) Factors for Consideration.--The Board of Governors and 
     the Council shall take into consideration the factors set 
     forth in subsection (a) or (b) of section 113, as applicable, 
     in a determination described in subsection (a) and in a 
     decision described in subsection (b).
       (d) Application to Foreign Financial Companies.--The Board 
     of Governors may prescribe regulations regarding the 
     application of this section to foreign nonbank financial 
     companies supervised by the Board of Governors and foreign-
     based bank holding companies, giving due regard to the 
     principle

[[Page S3205]]

     of national treatment and competitive equity.

               Subtitle B--Financial Information and Data

     SEC. 151. FINANCIAL INFORMATION AND DATA.

       (a) Authority To Obtain Information by Regulation.--
       (1) In general.--The Council is authorized to receive, and 
     may request the production of, any information and data from 
     Council member agencies, as necessary to identify potential 
     risks to United States financial system stability.
       (2) Submission by council members.--Notwithstanding any 
     other provision of law, any Council member agency, upon 
     request by the Council, shall provide information and data to 
     the Council, and the Council shall maintain the 
     confidentiality of such information and data.
       (3) Financial information and data collection.--
       (A) In general.--The Council may require, by rule, the 
     submission of periodic and other reports from any regulated 
     entity, solely for the purpose of assessing the extent to 
     which a financial activity or financial market in which the 
     financial company participates, or the financial company 
     itself, poses a risk to United States financial system 
     stability.
       (B) Mitigation of report burden.--Before requiring the 
     submission of reports from an regulated entity, the Council 
     shall coordinate and shall, whenever possible, rely on 
     information and data already being collected by or provided 
     to such agency.
       (C) Mitigation of requirements in case of foreign financial 
     parents.--Before requiring the submission of reports from anY 
     regulated entity that is affiliated with a holding company or 
     parent company that is a foreign company, the Council shall, 
     to the extent appropriate--
       (i) coordinate with any appropriate foreign regulator of 
     such company and any appropriate multilateral organization;
       (ii) request information regarding such company from such 
     foreign regulator; and
       (iii) whenever possible, rely on information already being 
     collected by such foreign regulator or multilateral 
     organizational.
       (D) Voluntary information and data collection from non-
     regulated entities.--The Council is authorized to request 
     information and data from non regulated entities. To the 
     extent possible, the Council shall minimize information and 
     data requests from non regulated entities, and in all cases, 
     such information and data requests shall be limited to 
     information and data requests relevant to maintaining United 
     States financial system stability. Nothing in this 
     subparagraph shall be construed to require the provision of 
     information or data by any non regulated entity that is not 
     otherwise required to provide such information or data under 
     this section or any other provision of law.
       (4) Definition.--As used in this subsection, the term 
     ``regulated entity'' means any entity, other than an 
     individual, that is regulated and supervised by a Council 
     member agency.
       (b) Additional Provisions.--
       (1) Information and data sharing.--The Chairperson of the 
     Council, in consultation with the other members of the 
     Council, may--
       (A) establish procedures, databases, and information 
     warehouses to share information and data collected by the 
     Council under this section with the members of the Council;
       (B) develop an electronic process for sharing all 
     information and data collected by the Council with the 
     Council member agencies;
       (C) designate the format in which requested information and 
     data shall be submitted to the Council, including any 
     electronic, digital, or other format that facilitates the use 
     of such information and data by the Council in its analyses.
       (2) Applicable privileges not waived.--A Federal financial 
     regulator, State financial regulator, United States financial 
     company, foreign financial company operating in the United 
     States, financial market utility, or other person shall not 
     be compelled to waive, and shall not be deemed to have 
     waived, any privilege otherwise applicable to any information 
     or data by transferring the information or data to, or 
     permitting that information or data to be used by--
       (A) the Council;
       (B) any Federal financial regulator or State financial 
     regulator, in any capacity; or
       (C) any other agency of the Federal Government (as defined 
     in section 6 of title 18, United States Code).
       (3) Confidentiality of information.--
       (A) Disclosure exemption.--The Council shall maintain the 
     confidentiality of information received under this subtitle, 
     and any information obtained by the Council under this 
     subtitle shall be exempt from the disclosure requirements 
     under section 552 of title 5, United States Code.
       (B) Council confidentiality.--Notwithstanding any other 
     provision of law, the Council may not be compelled to 
     disclose any report or information contained therein filed 
     with the Council under this subtitle, except that nothing in 
     this subtitle authorizes the Council--
       (i) to withhold information from Congress, upon an 
     agreement of confidentiality; or
       (ii) prevent the Council from complying with--

       (I) a request for information from any other Federal 
     department or agency or any self-regulatory organization 
     requesting the report or information for purposes within the 
     scope of its jurisdiction; or
       (II) an order of a court of the United States in an action 
     brought by the United States or the Council.

       (C) Protection of information and data.--The Council shall 
     maintain appropriate data security measures and ensure the 
     protection of any proprietary information or data of any 
     regulated entity or nonregulated entity.
       (4) Consultation with foreign governments.--Under the 
     supervision of the President, and in a manner consistent with 
     section 207 of the Foreign Service Act of 1980 (22 U.S.C. 
     3927), the Chairperson of the Council, in consultation with 
     the other members of the Council, shall regularly consult 
     with the financial regulatory entities and other appropriate 
     organizations of foreign governments or international 
     organizations on matters relating to risks to United States 
     financial system stability.

Subtitle C--Additional Board of Governors Authority for Certain Nonbank 
             Financial Companies and Bank Holding Companies

     SEC. 161. REPORTS BY AND EXAMINATIONS OF NONBANK FINANCIAL 
                   COMPANIES BY THE BOARD OF GOVERNORS.

       (a) Reports.--
       (1) In general.--The Board of Governors may require each 
     nonbank financial company supervised by the Board of 
     Governors, and any subsidiary thereof, to submit reports 
     under oath, to keep the Board of Governors informed as to--
       (A) the financial condition of the company or subsidiary, 
     systems of the company or subsidiary for monitoring and 
     controlling financial, operating, and other risks, and the 
     extent to which the activities and operations of the company 
     or subsidiary pose a threat to the financial stability of the 
     United States; and
       (B) compliance by the company or subsidiary with the 
     requirements of this subtitle.
       (2) Use of existing reports and information.--In carrying 
     out subsection (a), the Board of Governors shall, to the 
     fullest extent possible, use--
       (A) reports and supervisory information that a nonbank 
     financial company or subsidiary thereof has been required to 
     provide to other Federal or State regulatory agencies;
       (B) information otherwise obtainable from Federal or State 
     regulatory agencies;
       (C) information that is otherwise required to be reported 
     publicly; and
       (D) externally audited financial statements of such company 
     or subsidiary.
       (3) Availability.--Upon the request of the Board of 
     Governors, a nonbank financial company supervised by the 
     Board of Governors, or a subsidiary thereof, shall promptly 
     provide to the Board of Governors any information described 
     in paragraph (2).
       (b) Examinations.--
       (1) In general.--Subject to paragraph (2), the Board of 
     Governors may examine any nonbank financial company 
     supervised by the Board of Governors and any subsidiary of 
     such company, to determine--
       (A) the nature of the operations and financial condition of 
     the company and such subsidiary;
       (B) the financial, operational, and other risks within the 
     company that may pose a threat to the safety and soundness of 
     such company or to the financial stability of the United 
     States;
       (C) the systems for monitoring and controlling such risks; 
     and
       (D) compliance by the company with the requirements of this 
     subtitle.
       (2) Use of examination reports and information.--For 
     purposes of this subsection, the Board of Governors shall, to 
     the fullest extent possible, rely on reports of examination 
     of any depository institution subsidiary or functionally 
     regulated subsidiary made by the primary financial regulatory 
     agency for that subsidiary, and on information described in 
     subsection (a)(2).
       (c) Coordination With Primary Financial Regulatory 
     Agency.--The Board of Governors shall--
       (1) provide to the primary financial regulatory agency for 
     any company or subsidiary, reasonable notice before requiring 
     a report, requesting information, or commencing an 
     examination of such subsidiary under this section; and
       (2) avoid duplication of examination activities, reporting 
     requirements, and requests for information, to the extent 
     possible.

     SEC. 162. ENFORCEMENT.

       (a) In General.--Except as provided in subsection (b), a 
     nonbank financial company supervised by the Board of 
     Governors and any subsidiaries of such company (other than 
     any depository institution subsidiary) shall be subject to 
     the provisions of subsections (b) through (n) of section 8 of 
     the Federal Deposit Insurance Act (12 U.S.C. 1818), in the 
     same manner and to the same extent as if the company were a 
     bank holding company, as provided in section 8(b)(3) of the 
     Federal Deposit Insurance Act (12 U.S.C. 1818(b)(3)).
       (b) Enforcement Authority for Functionally Regulated 
     Subsidiaries.--
       (1) Referral.--If the Board of Governors determines that a 
     condition, practice, or activity of a depository institution 
     subsidiary or functionally regulated subsidiary of a nonbank 
     financial company supervised by the Board of Governors does 
     not comply with the regulations or orders prescribed by the 
     Board of Governors under this Act, or otherwise poses a 
     threat to the financial stability of the United States, the 
     Board of Governors may recommend, in writing, to the primary

[[Page S3206]]

     financial regulatory agency for the subsidiary that such 
     agency initiate a supervisory action or enforcement 
     proceeding. The recommendation shall be accompanied by a 
     written explanation of the concerns giving rise to the 
     recommendation.
       (2) Back-up authority of the board of governors.--If, 
     during the 60-day period beginning on the date on which the 
     primary financial regulatory agency receives a recommendation 
     under paragraph (1), the primary financial regulatory agency 
     does not take supervisory or enforcement action against a 
     subsidiary that is acceptable to the Board of Governors, the 
     Board of Governors (upon a vote of its members) may take the 
     recommended supervisory or enforcement action, as if the 
     subsidiary were a bank holding company subject to supervision 
     by the Board of Governors.

     SEC. 163. ACQUISITIONS.

       (a) Acquisitions of Banks; Treatment as a Bank Holding 
     Company.--For purposes of section 3 of the Bank Holding 
     Company Act of 1956 (12 U.S.C. 1842), a nonbank financial 
     company supervised by the Board of Governors shall be deemed 
     to be, and shall be treated as, a bank holding company.
       (b) Acquisition of Nonbank Companies.--
       (1) Prior notice for large acquisitions.--Notwithstanding 
     section 4(k)(6)(B) of the Bank Holding Company Act of 1956 
     (12 U.S.C. 1843(k)(6)(B)), a bank holding company with total 
     consolidated assets equal to or greater than $50,000,000,000 
     or a nonbank financial company supervised by the Board of 
     Governors shall not acquire direct or indirect ownership or 
     control of any voting shares of any company (other than an 
     insured depository institution) that is engaged in activities 
     described in section 4(k) of the Bank Holding Company Act of 
     1956 having total consolidated assets of $10,000,000,000 or 
     more, without providing written notice to the Board of 
     Governors in advance of the transaction.
       (2) Exemptions.--The prior notice requirement in paragraph 
     (1) shall not apply with regard to the acquisition of shares 
     that would qualify for the exemptions in section 4(c) or 
     section 4(k)(4)(E) of the Bank Holding Company Act of 1956 
     (12 U.S.C. 1843(c) and (k)(4)(E)).
       (3) Notice procedures.--The notice procedures set forth in 
     section 4(j)(1) of the Bank Holding Company Act of 1956 (12 
     U.S.C. 1843(j)(1)), without regard to section 4(j)(3) of that 
     Act, shall apply to an acquisition of any company (other than 
     an insured depository institution) by a bank holding company 
     with total consolidated assets equal to or greater than 
     $50,000,000,000 or a nonbank financial company supervised by 
     the Board of Governors, as described in paragraph (1), 
     including any such company engaged in activities described in 
     section 4(k) of that Act.
       (4) Standards for review.--In addition to the standards 
     provided in section 4(j)(2) of the Bank Holding Company Act 
     of 1956 (12 U.S.C. 1843(j)(2)), the Board of Governors shall 
     consider the extent to which the proposed acquisition would 
     result in greater or more concentrated risks to global or 
     United States financial stability or the United States 
     economy.

     SEC. 164. PROHIBITION AGAINST MANAGEMENT INTERLOCKS BETWEEN 
                   CERTAIN FINANCIAL COMPANIES.

       A nonbank financial company supervised by the Board of 
     Governors shall be treated as a bank holding company for 
     purposes of the Depository Institutions Management Interlocks 
     Act (12 U.S.C. 3201 et seq.), except that the Board of 
     Governors shall not exercise the authority provided in 
     section 7 of that Act (12 U.S.C. 3207) to permit service by a 
     management official of a nonbank financial company supervised 
     by the Board of Governors as a management official of any 
     bank holding company with total consolidated assets equal to 
     or greater than $50,000,000,000, or other nonaffiliated 
     nonbank financial company supervised by the Board of 
     Governors (other than to provide a temporary exemption for 
     interlocks resulting from a merger, acquisition, or 
     consolidation).

     SEC. 165. ENHANCED SUPERVISION AND PRUDENTIAL STANDARDS FOR 
                   NONBANK FINANCIAL COMPANIES SUPERVISED BY THE 
                   BOARD OF GOVERNORS AND CERTAIN BANK HOLDING 
                   COMPANIES.

       (a) In General.--
       (1) Purpose.--In order to prevent or mitigate risks to the 
     financial stability of the United States that could arise 
     from the material financial distress or failure of large, 
     interconnected financial institutions, the Board of Governors 
     shall, on its own or pursuant to recommendations by the 
     Council under section 115, establish prudential standards and 
     reporting and disclosure requirements applicable to nonbank 
     financial companies supervised by the Board of Governors and 
     large, interconnected bank holding companies that--
       (A) are more stringent than the standards and requirements 
     applicable to nonbank financial companies and bank holding 
     companies that do not present similar risks to the financial 
     stability of the United States; and
       (B) increase in stringency, based on the considerations 
     identified in subsection (b)(3).
       (2) Limitation on bank holding companies.--Any standards 
     established under subsections (b) through (f) shall not apply 
     to any bank holding company with total consolidated assets of 
     less than $50,000,000,000, but the Board of Governors may 
     establish an asset threshold greater than $50,000,000,000 for 
     the applicability of any particular standard under 
     subsections (b) through (f).
       (b) Development of Prudential Standards.--
       (1) In general.--
       (A) Required standards.--The Board of Governors shall, by 
     regulation or order, establish prudential standards for 
     nonbank financial companies supervised by the Board of 
     Governors and bank holding companies described in subsection 
     (a), that shall include--
       (i) risk-based capital requirements;
       (ii) leverage limits;
       (iii) liquidity requirements;
       (iv) resolution plan and credit exposure report 
     requirements; and
       (v) concentration limits.
       (B) Additional standards authorized.--The Board of 
     Governors may, by regulation or order, establish prudential 
     standards for nonbank financial companies supervised by the 
     Board of Governors and bank holding companies described in 
     subsection (a), that include--
       (i) a contingent capital requirement;
       (ii) enhanced public disclosures; and
       (iii) overall risk management requirements.
       (2) Prudential standards for foreign financial companies.--
     In applying the standards set forth in paragraph (1) to 
     foreign nonbank financial companies supervised by the Board 
     of Governors and to foreign-based bank holding companies, the 
     Board of Governors shall give due regard to the principle of 
     national treatment and competitive equity.
       (3) Considerations.--In prescribing prudential standards 
     under paragraph (1), the Board of Governors shall--
       (A) take into account differences among nonbank financial 
     companies supervised by the Board of Governors and bank 
     holding companies described in subsection (a), based on--
       (i) the factors described in subsections (a) and (b) of 
     section 113;
       (ii) whether the company owns an insured depository 
     institution;
       (iii) nonfinancial activities and affiliations of the 
     company; and
       (iv) any other factors that the Board of Governors 
     determines appropriate;
       (B) to the extent possible, ensure that small changes in 
     the factors listed in subsections (a) and (b) of section 113 
     would not result in sharp, discontinuous changes in the 
     prudential standards established under paragraph (1) of this 
     subsection; and
       (C) take into account any recommendations of the Council 
     under section 115.
       (4) Report.--The Board of Governors shall submit an annual 
     report to Congress regarding the implementation of the 
     prudential standards required pursuant to paragraph (1), 
     including the use of such standards to mitigate risks to the 
     financial stability of the United States.
       (c) Contingent Capital.--
       (1) In general.--Subsequent to submission by the Council of 
     a report to Congress under section 115(c), the Board of 
     Governors may promulgate regulations that require each 
     nonbank financial company supervised by the Board of 
     Governors and bank holding companies described in subsection 
     (a) to maintain a minimum amount of long-term hybrid debt 
     that is convertible to equity in times of financial stress.
       (2) Factors to consider.--In establishing regulations under 
     this subsection, the Board of Governors shall consider--
       (A) the results of the study undertaken by the Council, and 
     any recommendations of the Council, under section 115(c);
       (B) an appropriate transition period for implementation of 
     a conversion under this subsection;
       (C) the factors described in subsection (b)(3)(A);
       (D) capital requirements applicable to the nonbank 
     financial company supervised by the Board of Governors or a 
     bank holding company described in subsection (a), and 
     subsidiaries thereof; and
       (E) any other factor that the Board of Governors deems 
     appropriate.
       (d) Resolution Plan and Credit Exposure Reports.--
       (1) Resolution plan.--The Board of Governors shall require 
     each nonbank financial company supervised by the Board of 
     Governors and bank holding companies described in subsection 
     (a) to report periodically to the Board of Governors, the 
     Council, and the Corporation the plan of such company for 
     rapid and orderly resolution in the event of material 
     financial distress or failure.
       (2) Credit exposure report.--The Board of Governors shall 
     require each nonbank financial company supervised by the 
     Board of Governors and bank holding companies described in 
     subsection (a) to report periodically to the Board of 
     Governors, the Council, and the Corporation on--
       (A) the nature and extent to which the company has credit 
     exposure to other significant nonbank financial companies and 
     significant bank holding companies; and
       (B) the nature and extent to which other significant 
     nonbank financial companies and significant bank holding 
     companies have credit exposure to that company.
       (3) Review.--The Board of Governors and the Corporation 
     shall review the information provided in accordance with this 
     section by each nonbank financial company supervised by the 
     Board of Governors and bank holding company described in 
     subsection (a).
       (4) Notice of deficiencies.--If the Board of Governors and 
     the Corporation jointly determine, based on their review 
     under paragraph (3), that the resolution plan of a nonbank 
     financial company supervised by the Board of

[[Page S3207]]

     Governors or a bank holding company described in subsection 
     (a) is not credible or would not facilitate an orderly 
     resolution of the company under title 11, United States 
     Code--
       (A) the Board of Governors and the Corporation shall notify 
     the company, as applicable, of the deficiencies in the 
     resolution plan; and
       (B) the company shall resubmit the resolution plan within a 
     time frame determined by the Board of Governors and the 
     Corporation, with revisions demonstrating that the plan is 
     credible and would result in an orderly resolution under 
     title 11, United States Code, including any proposed changes 
     in business operations and corporate structure to facilitate 
     implementation of the plan.
       (5) Failure to resubmit credible plan.--
       (A) In general.--If a nonbank financial company supervised 
     by the Board of Governors or a bank holding company described 
     in subsection (a) fails to timely resubmit the resolution 
     plan as required under paragraph (4), with such revisions as 
     are required under subparagraph (B), the Board of Governors 
     and the Corporation may jointly impose more stringent 
     capital, leverage, or liquidity requirements, or restrictions 
     on the growth, activities, or operations of the company, or 
     any subsidiary thereof, until such time as the company 
     resubmits a plan that remedies the deficiencies.
       (B) Divestiture.--The Board of Governors and the 
     Corporation, in consultation with the Council, may direct a 
     nonbank financial company supervised by the Board of 
     Governors or a bank holding company described in subsection 
     (a), by order, to divest certain assets or operations 
     identified by the Board of Governors and the Corporation, to 
     facilitate an orderly resolution of such company under title 
     11, United States Code, in the event of the failure of such 
     company, in any case in which--
       (i) the Board of Governors and the Corporation have jointly 
     imposed more stringent requirements on the company pursuant 
     to subparagraph (A); and
       (ii) the company has failed, within the 2-year period 
     beginning on the date of the imposition of such requirements 
     under subparagraph (A), to resubmit the resolution plan with 
     such revisions as were required under paragraph (4)(B).
       (6) Rules.--Not later than 18 months after the date of 
     enactment of this Act, the Board of Governors and the 
     Corporation shall jointly issue final rules implementing this 
     subsection.
       (e) Concentration Limits.--
       (1) Standards.--In order to limit the risks that the 
     failure of any individual company could pose to a nonbank 
     financial company supervised by the Board of Governors or a 
     bank holding company described in subsection (a), the Board 
     of Governors, by regulation, shall prescribe standards that 
     limit such risks.
       (2) Limitation on credit exposure.--The regulations 
     prescribed by the Board of Governors under paragraph (1) 
     shall prohibit each nonbank financial company supervised by 
     the Board of Governors and bank holding company described in 
     subsection (a) from having credit exposure to any 
     unaffiliated company that exceeds 25 percent of the capital 
     stock and surplus (or such lower amount as the Board of 
     Governors may determine by regulation to be necessary to 
     mitigate risks to the financial stability of the United 
     States) of the company.
       (3) Credit exposure.--For purposes of paragraph (2), 
     ``credit exposure'' to a company means--
       (A) all extensions of credit to the company, including 
     loans, deposits, and lines of credit;
       (B) all repurchase agreements and reverse repurchase 
     agreements with the company;
       (C) all securities borrowing and lending transactions with 
     the company, to the extent that such transactions create 
     credit exposure for the nonbank financial company supervised 
     by the Board of Governors or a bank holding company described 
     in subsection (a);
       (D) all guarantees, acceptances, or letters of credit 
     (including endorsement or standby letters of credit) issued 
     on behalf of the company;
       (E) all purchases of or investment in securities issued by 
     the company;
       (F) counterparty credit exposure to the company in 
     connection with a derivative transaction between the nonbank 
     financial company supervised by the Board of Governors or a 
     bank holding company described in subsection (a) and the 
     company; and
       (G) any other similar transactions that the Board of 
     Governors, by regulation, determines to be a credit exposure 
     for purposes of this section.
       (4) Attribution rule.--For purposes of this subsection, any 
     transaction by a nonbank financial company supervised by the 
     Board of Governors or a bank holding company described in 
     subsection (a) with any person is a transaction with a 
     company, to the extent that the proceeds of the transaction 
     are used for the benefit of, or transferred to, that company.
       (5) Rulemaking.--The Board of Governors may issue such 
     regulations and orders, including definitions consistent with 
     this section, as may be necessary to administer and carry out 
     this subsection.
       (6) Exemptions.--The Board of Governors may, by regulation 
     or order, exempt transactions, in whole or in part, from the 
     definition of ``credit exposure'' for purposes of this 
     subsection, if the Board of Governors finds that the 
     exemption is in the public interest and is consistent with 
     the purpose of this subsection.
       (7) Transition period.--
       (A) In general.--This subsection and any regulations and 
     orders of the Board of Governors under this subsection shall 
     not be effective until 3 years after the date of enactment of 
     this Act.
       (B) Extension authorized.--The Board of Governors may 
     extend the period specified in subparagraph (A) for not 
     longer than an additional 2 years.
       (f) Enhanced Public Disclosures.--The Board of Governors 
     may prescribe, by regulation, periodic public disclosures by 
     nonbank financial companies supervised by the Board of 
     Governors and bank holding companies described in subsection 
     (a) in order to support market evaluation of the risk 
     profile, capital adequacy, and risk management capabilities 
     thereof.
       (g) Risk Committee.--
       (1) Nonbank financial companies supervised by the board of 
     governors.--The Board of Governors shall require each nonbank 
     financial company supervised by the Board of Governors that 
     is a publicly traded company to establish a risk committee, 
     as set forth in paragraph (3), not later than 1 year after 
     the date of receipt of a notice of final determination under 
     section 113(d)(3) with respect to such nonbank financial 
     company supervised by the Board of Governors.
       (2) Certain bank holding companies.--
       (A) Mandatory regulations.--The Board of Governors shall 
     issue regulations requiring each bank holding company that is 
     a publicly traded company and that has total consolidated 
     assets of not less than $10,000,000,000 to establish a risk 
     committee, as set forth in paragraph (3).
       (B) Permissive regulations.--The Board of Governors may 
     require each bank holding company that is a publicly traded 
     company and that has total consolidated assets of less than 
     $10,000,000,000 to establish a risk committee, as set forth 
     in paragraph (3), as determined necessary or appropriate by 
     the Board of Governors to promote sound risk management 
     practices.
       (3) Risk committee.--A risk committee required by this 
     subsection shall--
       (A) be responsible for the oversight of the enterprise-wide 
     risk management practices of the nonbank financial company 
     supervised by the Board of Governors or bank holding company 
     described in subsection (a), as applicable;
       (B) include such number of independent directors as the 
     Board of Governors may determine appropriate, based on the 
     nature of operations, size of assets, and other appropriate 
     criteria related to the nonbank financial company supervised 
     by the Board of Governors or a bank holding company described 
     in subsection (a), as applicable; and
       (C) include at least 1 risk management expert having 
     experience in identifying, assessing, and managing risk 
     exposures of large, complex firms.
       (4) Rulemaking.--The Board of Governors shall issue final 
     rules to carry out this subsection, not later than 1 year 
     after the transfer date, to take effect not later than 15 
     months after the transfer date.
       (h) Stress Tests.--The Board of Governors shall conduct 
     analyses in which nonbank financial companies supervised by 
     the Board of Governors and bank holding companies described 
     in subsection (a) are subject to evaluation of whether the 
     companies have the capital, on a total consolidated basis, 
     necessary to absorb losses as a result of adverse economic 
     conditions. The Board of Governors may develop and apply such 
     other analytic techniques as are necessary to identify, 
     measure, and monitor risks to the financial stability of the 
     United States.

     SEC. 166. EARLY REMEDIATION REQUIREMENTS.

       (a) In General.--The Board of Governors, in consultation 
     with the Council and the Corporation, shall prescribe 
     regulations establishing requirements to provide for the 
     early remediation of financial distress of a nonbank 
     financial company supervised by the Board of Governors or a 
     bank holding company described in section 165(a), except that 
     nothing in this subsection authorizes the provision of 
     financial assistance from the Federal Government.
       (b) Purpose of the Early Remediation Requirements.--The 
     purpose of the early remediation requirements under 
     subsection (a) shall be to establish a series of specific 
     remedial actions to be taken by a nonbank financial company 
     supervised by the Board of Governors or a bank holding 
     company described in section 165(a) that is experiencing 
     increasing financial distress, in order to minimize the 
     probability that the company will become insolvent and the 
     potential harm of such insolvency to the financial stability 
     of the United States.
       (c) Remediation Requirements.--The regulations prescribed 
     by the Board of Governors under subsection (a) shall--
       (1) define measures of the financial condition of the 
     company, including regulatory capital, liquidity measures, 
     and other forward-looking indicators; and
       (2) establish requirements that increase in stringency as 
     the financial condition of the company declines, including--
       (A) requirements in the initial stages of financial 
     decline, including limits on capital distributions, 
     acquisitions, and asset growth; and
       (B) requirements at later stages of financial decline, 
     including a capital restoration

[[Page S3208]]

     plan and capital-raising requirements, limits on transactions 
     with affiliates, management changes, and asset sales.

     SEC. 167. AFFILIATIONS.

       (a) Affiliations.--Nothing in this subtitle shall be 
     construed to require a nonbank financial company supervised 
     by the Board of Governors, or a company that controls a 
     nonbank financial company supervised by the Board of 
     Governors, to conform the activities thereof to the 
     requirements of section 4 of the Bank Holding Company Act of 
     1956 (12 U.S.C. 1843).
       (b) Requirement.--
       (1) In general.--If a nonbank financial company supervised 
     by the Board of Governors conducts activities other than 
     those that are determined to be financial in nature or 
     incidental thereto under section 4(k) of the Bank Holding 
     Company Act of 1956, the Board of Governors may require such 
     company to establish and conduct such activities that are 
     determined to be financial in nature or incidental thereto in 
     an intermediate holding company established pursuant to 
     regulation of the Board of Governors, not later than 90 days 
     after the date on which the nonbank financial company 
     supervised by the Board of Governors was notified of the 
     determination under section 113(a).
       (2) Internal financial activities.--For purposes of this 
     subsection, activities that are determined to be financial in 
     nature or incidental thereto under section 4(k) of the Bank 
     Holding Company Act of 1956, as described in paragraph (1), 
     shall not include internal financial activities conducted for 
     a nonbank financial company supervised by the Board of 
     Governors or any affiliate, including internal treasury, 
     investment, and employee benefit functions. With respect to 
     any internal financial activity of such company during the 
     year prior to the date of enactment of this Act, such company 
     may continue to engage in such activity as long as at least 
     \2/3\ of the assets or \2/3\ of the revenues generated from 
     the activity are from or attributable to such company, 
     subject to review by the Board of Governors, to determine 
     whether engaging in such activity presents undue risk to such 
     company or to the financial stability of the United States.
       (c) Regulations.--The Board of Governors--
       (1) shall promulgate regulations to establish the criteria 
     for determining whether to require a nonbank financial 
     company supervised by the Board of Governors to establish an 
     intermediate holding company under subsection (a); and
       (2) may promulgate regulations to establish any 
     restrictions or limitations on transactions between an 
     intermediate holding company or a nonbank financial company 
     supervised by the Board of Governors and its affiliates, as 
     necessary to prevent unsafe and unsound practices in 
     connection with transactions between such company, or any 
     subsidiary thereof, and its parent company or affiliates that 
     are not subsidiaries of such company, except that such 
     regulations shall not restrict or limit any transaction in 
     connection with the bona fide acquisition or lease by an 
     unaffiliated person of assets, goods, or services.

     SEC. 168. REGULATIONS.

       Except as otherwise specified in this subtitle, not later 
     than 18 months after the transfer date, the Board of 
     Governors shall issue final regulations to implement this 
     subtitle and the amendments made by this subtitle.

     SEC. 169. AVOIDING DUPLICATION.

       The Board of Governors shall take any action that the Board 
     of Governors deems appropriate to avoid imposing requirements 
     under this subtitle that are duplicative of requirements 
     applicable to bank holding companies and nonbank financial 
     companies under other provisions of law.

     SEC. 170. SAFE HARBOR.

       (a) Regulations.--The Board of Governors shall promulgate 
     regulations on behalf of, and in consultation with, the 
     Council setting forth the criteria for exempting certain 
     types or classes of U.S. nonbank financial companies or 
     foreign nonbank financial companies from supervision by the 
     Board of Governors.
       (b) Considerations.--In developing the criteria under 
     subsection (a), the Board of Governors shall take into 
     account the factors for consideration described in 
     subsections (a) and (b) of section 113 in determining whether 
     a U.S. nonbank financial company or foreign nonbank financial 
     company shall be supervised by the Board of Governors.
       (c) Rule of Construction.--Nothing in this section shall be 
     construed to require supervision by the Board of Governors of 
     a U.S. nonbank financial company or foreign nonbank financial 
     company, if such company does not meet the criteria for 
     exemption established under subsection (a).
       (d) Update.--The Board of Governors shall, in consultation 
     with the Council, review the regulations promulgated under 
     subsection (a), not less frequently than every 5 years, and 
     based upon the review, the Board of Governors may revise such 
     regulations on behalf of, and in consultation with, the 
     Council to update as necessary the criteria set forth in such 
     regulations.
       (e) Transition Period.--No revisions under subsection (d) 
     shall take effect before the end of the 2-year period after 
     the date of publication of such revisions in final form.
       (f) Report.--The Chairperson of the Board of Governors and 
     the Chairperson of the Council shall submit a joint report to 
     the Committee on Banking, Housing, and Urban Affairs of the 
     Senate and the Committee on Financial Services of the House 
     of Representatives not later than 30 days after the date of 
     the issuance in final form of the regulations under 
     subsection (a), or any subsequent revision to such 
     regulations under subsection (d), as applicable. Such report 
     shall include, at a minimum, the rationale for exemption and 
     empirical evidence to support the criteria for exemption.
                                 ______
                                 
  SA 3825. Mr. SHELBY submitted an amendment intended to be proposed to 
amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mrs. Lincoln)) to the bill S. 3217, to promote the financial stability 
of the United States by improving accountability and transparency in 
the financial system, to end ``too big to fail'', to protect the 
American taxpayer by ending bailouts, to protect consumers from abusive 
financial services practices, and for other purposes; which was ordered 
to lie on the table; as follows:

       Strike title I and insert the following:

                      TITLE I--FINANCIAL STABILITY

     SEC. 101. SHORT TITLE.

       This title may be cited as the ``Financial Stability Act of 
     2010''.

     SEC. 102. DEFINITIONS.

       (a) In General.--For purposes of this title, unless the 
     context otherwise requires, the following definitions shall 
     apply:
       (1) Bank holding company.--The term ``bank holding 
     company'' has the same meaning as in section 2 of the Bank 
     Holding Company Act of 1956 (12 U.S.C. 1841). A foreign bank 
     or company that is treated as a bank holding company for 
     purposes of the Bank Holding Company Act of 1956, pursuant to 
     section 8(a) of the International Banking Act of 1978 (12 
     U.S.C. 3106(a)), shall be treated as a bank holding company 
     for purposes of this title.
       (2) Chairperson.--The term ``Chairperson'' means the 
     Chairperson of the Council.
       (3) Member agency.--The term ``member agency'' means an 
     agency represented by a voting member of the Council.
       (4) Nonbank financial company definitions.--
       (A) Foreign nonbank financial company.--The term ``foreign 
     nonbank financial company'' means a company (other than a 
     company that is, or is treated in the United States as, a 
     bank holding company or a subsidiary thereof) that is--
       (i) incorporated or organized in a country other than the 
     United States; and
       (ii) substantially engaged in, including through a branch 
     in the United States, activities in the United States that 
     are financial in nature (as defined in section 4(k) of the 
     Bank Holding Company Act of 1956).
       (B) U.S. nonbank financial company.--The term ``U.S. 
     nonbank financial company'' means a company (other than a 
     bank holding company or a subsidiary thereof, or a Farm 
     Credit System institution chartered and subject to the 
     provisions of the Farm Credit Act of 1971 (12 U.S.C. 2001 et. 
     seq.)) that is--
       (i) incorporated or organized under the laws of the United 
     States or any State; and
       (ii) substantially engaged in activities in the United 
     States that are financial in nature (as defined in section 
     4(k) of the Bank Holding Company Act of 1956).
       (C) Nonbank financial company.--The term ``nonbank 
     financial company'' means a U.S. nonbank financial company 
     and a foreign nonbank financial company.
       (D) Nonbank financial company supervised by the board of 
     governors.--The term ``nonbank financial company supervised 
     by the Board of Governors'' means a nonbank financial company 
     that the Council has determined under section 113 shall be 
     supervised by the Board of Governors.
       (5) Office of financial research.--The term ``Office of 
     Financial Research'' means the office established under 
     section 152.
       (6) Significant institutions.--The terms ``significant 
     nonbank financial company'' and ``significant bank holding 
     company'' have the meanings given those terms by rule of the 
     Board of Governors.
       (b) Definitional Criteria.--The Board of Governors shall 
     establish, by regulation, the criteria to determine whether a 
     company is substantially engaged in activities in the United 
     States that are financial in nature (as defined in section 
     4(k) of the Bank Holding Company Act of 1956) for purposes of 
     the definitions of the terms ``U.S. nonbank financial 
     company'' and ``foreign nonbank financial company'' under 
     subsection (a)(4).
       (c) Foreign Nonbank Financial Companies.--For purposes of 
     the authority of the Board of Governors under this title with 
     respect to foreign nonbank financial companies, references in 
     this title to ``company'' or ``subsidiary'' include only the 
     United States activities and subsidiaries of such foreign 
     company.

           Subtitle A--Financial Stability Oversight Council

     SEC. 111. FINANCIAL STABILITY OVERSIGHT COUNCIL ESTABLISHED.

       (a) Establishment.--Effective on the date of enactment of 
     this Act, there is established the Financial Stability 
     Oversight Council.
       (b) Membership.--The Council shall consist of the following 
     members:
       (1) Voting members.--The voting members, who shall each 
     have 1 vote on the Council shall be--

[[Page S3209]]

       (A) the Secretary of the Treasury, who shall serve as 
     Chairperson of the Council;
       (B) the Chairman of the Board of Governors;
       (C) the Comptroller of the Currency;
       (D) the Director of the Bureau;
       (E) the Chairman of the Commission;
       (F) the Chairperson of the Corporation;
       (G) the Chairperson of the Commodity Futures Trading 
     Commission;
       (H) the Director of the Federal Housing Finance Agency; and
       (I) an independent member appointed by the President, by 
     and with the advice and consent of the Senate, having 
     insurance expertise.
       (2) Nonvoting members.--The Director of the Office of 
     Financial Research--
       (A) shall serve in an advisory capacity as a nonvoting 
     member of the Council; and
       (B) may not be excluded from any of the proceedings, 
     meetings, discussions, or deliberations of the Council.
       (c) Terms; Vacancy.--
       (1) Terms.--The independent member of the Council shall 
     serve for a term of 6 years.
       (2) Vacancy.--Any vacancy on the Council shall be filled in 
     the manner in which the original appointment was made.
       (3) Acting officials may serve.--In the event of a vacancy 
     in the office of the head of a member agency or department, 
     and pending the appointment of a successor, or during the 
     absence or disability of the head of a member agency or 
     department, the acting head of the member agency or 
     department shall serve as a member of the Council in the 
     place of that agency or department head.
       (d) Technical and Professional Advisory Committees.--The 
     Council may appoint such special advisory, technical, or 
     professional committees as may be useful in carrying out the 
     functions of the Council, including an advisory committee 
     consisting of State regulators, and the members of such 
     committees may be members of the Council, or other persons, 
     or both.
       (e) Meetings.--
       (1) Timing.--The Council shall meet at the call of the 
     Chairperson or a majority of the members then serving, but 
     not less frequently than quarterly.
       (2) Rules for conducting business.--The Council shall adopt 
     such rules as may be necessary for the conduct of the 
     business of the Council. Such rules shall be rules of agency 
     organization, procedure, or practice for purposes of section 
     553 of title 5, United States Code.
       (f) Voting.--Unless otherwise specified, the Council shall 
     make all decisions that it is authorized or required to make 
     by a majority vote of the members then serving.
       (g) Nonapplicability of FACA.--The Federal Advisory 
     Committee Act (5 U.S.C. App.) shall not apply to the Council, 
     or to any special advisory, technical, or professional 
     committee appointed by the Council, except that, if an 
     advisory, technical, or professional committee has one or 
     more members who are not employees of or affiliated with the 
     United States Government, the Council shall publish a list of 
     the names of the members of such committee.
       (h) Assistance From Federal Agencies.--Any department or 
     agency of the United States may provide to the Council and 
     any special advisory, technical, or professional committee 
     appointed by the Council, such services, funds, facilities, 
     staff, and other support services as the Council may 
     determine advisable.
       (i) Compensation of Members.--
       (1) Federal employee members.--All members of the Council 
     who are officers or employees of the United States shall 
     serve without compensation in addition to that received for 
     their services as officers or employees of the United States.
       (2) Compensation for non-federal member.--Section 5314 of 
     title 5, United States Code, is amended by adding at the end 
     the following:
       ``Independent Member of the Financial Stability Oversight 
     Council (1).''.
       (j) Detail of Government Employees.--Any employee of the 
     Federal Government may be detailed to the Council without 
     reimbursement, and such detail shall be without interruption 
     or loss of civil service status or privilege. An employee of 
     the Federal Government detailed to the Council shall report 
     to and be subject to oversight by the Council during the 
     assignment to the Council, and shall be compensated by the 
     department or agency from which the employee was detailed.

     SEC. 112. COUNCIL AUTHORITY.

       (a) Purposes and Duties of the Council.--
       (1) In general.--The purposes of the Council are--
       (A) to identify risks to the financial stability of the 
     United States that could arise from the material financial 
     distress or failure of large, interconnected bank holding 
     companies or nonbank financial companies;
       (B) to promote market discipline, by eliminating 
     expectations on the part of shareholders, creditors, and 
     counterparties of such companies that the Government will 
     shield them from losses in the event of failure; and
       (C) to respond to emerging threats to the stability of the 
     United States financial markets.
       (2) Duties.--The Council shall, in accordance with this 
     title--
       (A) collect information from member agencies and other 
     Federal and State financial regulatory agencies and, if 
     necessary to assess risks to the United States financial 
     system, direct the Office of Financial Research to collect 
     information from bank holding companies and nonbank financial 
     companies;
       (B) provide direction to, and request data and analyses 
     from, the Office of Financial Research to support the work of 
     the Council;
       (C) monitor the financial services marketplace in order to 
     identify potential threats to the financial stability of the 
     United States;
       (D) facilitate information sharing and coordination among 
     the member agencies and other Federal and State agencies 
     regarding domestic financial services policy development, 
     rulemaking, examinations, reporting requirements, and 
     enforcement actions;
       (E) recommend to the member agencies general supervisory 
     priorities and principles reflecting the outcome of 
     discussions among the member agencies;
       (F) identify gaps in regulation that could pose risks to 
     the financial stability of the United States;
       (G) require supervision by the Board of Governors for 
     nonbank financial companies that may pose risks to the 
     financial stability of the United States in the event of 
     their material financial distress or failure, pursuant to 
     section 113;
       (H) make recommendations to the Board of Governors 
     concerning the establishment of heightened prudential 
     standards for risk-based capital, leverage, liquidity, 
     contingent capital, resolution plans and credit exposure 
     reports, concentration limits, enhanced public disclosures, 
     and overall risk management for nonbank financial companies 
     and large, interconnected bank holding companies supervised 
     by the Board of Governors;
       (I) identify systemically important financial market 
     utilities and payment, clearing, and settlement activities 
     (as that term is defined in title VIII), and require such 
     utilities and activities to be subject to standards 
     established by the Board of Governors;
       (J) make recommendations to primary financial regulatory 
     agencies to apply new or heightened standards and safeguards 
     for financial activities or practices that could create or 
     increase risks of significant liquidity, credit, or other 
     problems spreading among bank holding companies, nonbank 
     financial companies, and United States financial markets;
       (K) make determinations regarding exemptions in title VII, 
     where necessary;
       (L) provide a forum for--
       (i) discussion and analysis of emerging market developments 
     and financial regulatory issues; and
       (ii) resolution of jurisdictional disputes among the 
     members of the Council; and
       (M) annually report to and testify before Congress on--
       (i) the activities of the Council;
       (ii) significant financial market developments and 
     potential emerging threats to the financial stability of the 
     United States;
       (iii) all determinations made under section 113 or title 
     VIII, and the basis for such determinations; and
       (iv) recommendations--

       (I) to enhance the integrity, efficiency, competitiveness, 
     and stability of United States financial markets;
       (II) to promote market discipline; and
       (III) to maintain investor confidence.

       (b) Authority To Obtain Information.--
       (1) In general.--The Council may receive, and may request 
     the submission of, any data or information from the Office of 
     Financial Research and member agencies, as necessary--
       (A) to monitor the financial services marketplace to 
     identify potential risks to the financial stability of the 
     United States; or
       (B) to otherwise carry out any of the provisions of this 
     title.
       (2) Submissions by the office and member agencies.--
     Notwithstanding any other provision of law, the Office of 
     Financial Research and any member agency are authorized to 
     submit information to the Council.
       (3) Financial data collection.--
       (A) In general.--The Council, acting through the Office of 
     Financial Research, may require the submission of periodic 
     and other reports from any nonbank financial company 
     regulated by the Board of Governors or bank holding company 
     for the purpose of assessing the extent to which a financial 
     activity or financial market in which the nonbank financial 
     company or bank holding company participates, or such nonbank 
     financial company or bank holding company itself, poses a 
     threat to the financial stability of the United States.
       (B) Mitigation of report burden.--Before requiring the 
     submission of reports from any nonbank financial company or 
     bank holding company that is regulated by a member agency or 
     any primary financial regulatory agency, the Council, acting 
     through the Office of Financial Research, shall coordinate 
     with such agencies and shall, whenever possible, rely on 
     information available from the Office of Financial Research 
     or such agencies.
       (4) Back-up examination by the board of governors.--If the 
     Council is unable to determine whether the financial 
     activities of a nonbank financial company pose a threat to 
     the financial stability of the United States, based on 
     information or reports obtained under paragraph (3), 
     discussions with management, and publicly available 
     information, the Council may request the Board of Governors, 
     and the Board of Governors is authorized, to conduct an 
     examination of the nonbank financial company for the sole 
     purpose of determining whether the nonbank financial company 
     should be supervised by the Board of Governors for purposes 
     of this title.

[[Page S3210]]

       (5) Confidentiality.--
       (A) In general.--The Council, the Office of Financial 
     Research, and the other member agencies shall maintain the 
     confidentiality of any data, information, and reports 
     submitted under this subsection and subtitle B.
       (B) Retention of privilege.--The submission of any 
     nonpublicly available data or information under this 
     subsection and subtitle B shall not constitute a waiver of, 
     or otherwise affect, any privilege arising under Federal or 
     State law (including the rules of any Federal or State court) 
     to which the data or information is otherwise subject.
       (C) Freedom of information act.--Section 552 of title 5, 
     United States Code, including the exceptions thereunder, 
     shall apply to any data or information submitted under this 
     subsection and subtitle B.

     SEC. 113. AUTHORITY TO REQUIRE SUPERVISION AND REGULATION OF 
                   CERTAIN NONBANK FINANCIAL COMPANIES.

       (a) U.S. Nonbank Financial Companies Supervised by the 
     Board of Governors.--
       (1) Determination.--The Council, on a nondelegable basis 
     and by a vote of not fewer than \2/3\ of the members then 
     serving, including an affirmative vote by the Chairperson, 
     may determine that a U.S. nonbank financial company shall be 
     supervised by the Board of Governors and shall be subject to 
     prudential standards, in accordance with this title, if the 
     Council determines that material financial distress at the 
     U.S. nonbank financial company would pose a threat to the 
     financial stability of the United States.
       (2) Considerations.--Each determination under paragraph (1) 
     shall be based on a consideration by the Council of--
       (A) the degree of leverage of the company;
       (B) the amount and nature of the financial assets of the 
     company;
       (C) the amount and types of the liabilities of the company, 
     including the degree of reliance on short-term funding;
       (D) the extent and types of the off-balance-sheet exposures 
     of the company;
       (E) the extent and types of the transactions and 
     relationships of the company with other significant nonbank 
     financial companies and significant bank holding companies;
       (F) the importance of the company as a source of credit for 
     households, businesses, and State and local governments and 
     as a source of liquidity for the United States financial 
     system;
       (G) the recommendation, if any, of a member of the Council;
       (H) the operation of, or ownership interest in, any 
     clearing, settlement, or payment business of the company;
       (I) the extent to which--
       (i) assets are managed rather than owned by the company; 
     and
       (ii) ownership of assets under management is diffuse; and
       (J) any other factors that the Council deems appropriate.
       (b) Foreign Nonbank Financial Companies Supervised by the 
     Board of Governors.--
       (1) Determination.--The Council, on a nondelegable basis 
     and by a vote of not fewer than \2/3\ of the members then 
     serving, including an affirmative vote by the Chairperson, 
     may determine that a foreign nonbank financial company that 
     has substantial assets or operations in the United States 
     shall be supervised by the Board of Governors and shall be 
     subject to prudential standards in accordance with this 
     title, if the Council determines that material financial 
     distress at the foreign nonbank financial company would pose 
     a threat to the financial stability of the United States.
       (2) Considerations.--Each determination under paragraph (1) 
     shall be based on a consideration by the Council of--
       (A) the degree of leverage of the company;
       (B) the amount and nature of the United States financial 
     assets of the company;
       (C) the amount and types of the liabilities of the company 
     used to fund activities and operations in the United States, 
     including the degree of reliance on short-term funding;
       (D) the extent of the United States-related off-balance-
     sheet exposure of the company;
       (E) the extent and type of the transactions and 
     relationships of the company with other significant nonbank 
     financial companies and bank holding companies;
       (F) the importance of the company as a source of credit for 
     United States households, businesses, and State and local 
     governments, and as a source of liquidity for the United 
     States financial system;
       (G) the recommendation, if any, of a member of the Council;
       (H) the extent to which--
       (i) assets are managed rather than owned by the company; 
     and
       (ii) ownership of assets under management is diffuse; and
       (I) any other factors that the Council deems appropriate.
       (c) Reevaluation and Rescission.--The Council shall--
       (1) not less frequently than annually, reevaluate each 
     determination made under subsections (a) and (b) with respect 
     to each nonbank financial company supervised by the Board of 
     Governors; and
       (2) rescind any such determination, if the Council, by a 
     vote of not fewer than \2/3\ of the members then serving, 
     including an affirmative vote by the Chairperson, determines 
     that the nonbank financial company no longer meets the 
     standards under subsection (a) or (b), as applicable.
       (d) Notice and Opportunity for Hearing and Final 
     Determination.--
       (1) In general.--The Council shall provide to a nonbank 
     financial company written notice of a proposed determination 
     of the Council, including an explanation of the basis of the 
     proposed determination of the Council, that such nonbank 
     financial company shall be supervised by the Board of 
     Governors and shall be subject to prudential standards in 
     accordance with this title.
       (2) Hearing.--Not later than 30 days after the date of 
     receipt of any notice of a proposed determination under 
     paragraph (1), the nonbank financial company may request, in 
     writing, an opportunity for a written or oral hearing before 
     the Council to contest the proposed determination. Upon 
     receipt of a timely request, the Council shall fix a time 
     (not later than 30 days after the date of receipt of the 
     request) and place at which such company may appear, 
     personally or through counsel, to submit written materials 
     (or, at the sole discretion of the Council, oral testimony 
     and oral argument).
       (3) Final determination.--Not later than 60 days after the 
     date of a hearing under paragraph (2), the Council shall 
     notify the nonbank financial company of the final 
     determination of the Council, which shall contain a statement 
     of the basis for the decision of the Council.
       (4) No hearing requested.--If a nonbank financial company 
     does not make a timely request for a hearing, the Council 
     shall notify the nonbank financial company, in writing, of 
     the final determination of the Council under subsection (a) 
     or (b), as applicable, not later than 10 days after the date 
     by which the company may request a hearing under paragraph 
     (2).
       (e) Emergency Exception.--
       (1) In general.--The Council may waive or modify the 
     requirements of subsection (d) with respect to a nonbank 
     financial company, if the Council determines, by a vote of 
     not fewer than \2/3\ of the members then serving, including 
     an affirmative vote by the Chairperson, that such waiver or 
     modification is necessary or appropriate to prevent or 
     mitigate threats posed by the nonbank financial company to 
     the financial stability of the United States.
       (2) Notice.--The Council shall provide notice of a waiver 
     or modification under this paragraph to the nonbank financial 
     company concerned as soon as practicable, but not later than 
     24 hours after the waiver or modification is granted.
       (3) Opportunity for hearing.--The Council shall allow a 
     nonbank financial company to request, in writing, an 
     opportunity for a written or oral hearing before the Council 
     to contest a waiver or modification under this paragraph, not 
     later than 10 days after the date of receipt of notice of the 
     waiver or modification by the company. Upon receipt of a 
     timely request, the Council shall fix a time (not later than 
     15 days after the date of receipt of the request) and place 
     at which the nonbank financial company may appear, personally 
     or through counsel, to submit written materials (or, at the 
     sole discretion of the Council, oral testimony and oral 
     argument).
       (4) Notice of final determination.--Not later than 30 days 
     after the date of any hearing under paragraph (3), the 
     Council shall notify the subject nonbank financial company of 
     the final determination of the Council under this paragraph, 
     which shall contain a statement of the basis for the decision 
     of the Council.
       (f) Consultation.--The Council shall consult with the 
     primary financial regulatory agency, if any, for each nonbank 
     financial company or subsidiary of a nonbank financial 
     company that is being considered for supervision by the Board 
     of Governors under this section before the Council makes any 
     final determination with respect to such nonbank financial 
     company under subsection (a), (b), or (c).
       (g) Judicial Review.--If the Council makes a final 
     determination under this section with respect to a nonbank 
     financial company, such nonbank financial company may, not 
     later than 30 days after the date of receipt of the notice of 
     final determination under subsection (d)(3) or (e)(4), bring 
     an action in the United States district court for the 
     judicial district in which the home office of such nonbank 
     financial company is located, or in the United States 
     District Court for the District of Columbia, for an order 
     requiring that the final determination be rescinded, and the 
     court shall, upon review, dismiss such action or direct the 
     final determination to be rescinded. Review of such an action 
     shall be limited to whether the final determination made 
     under this section was arbitrary and capricious.

     SEC. 114. REGISTRATION OF NONBANK FINANCIAL COMPANIES 
                   SUPERVISED BY THE BOARD OF GOVERNORS.

       Not later than 180 days after the date of a final Council 
     determination under section 113 that a nonbank financial 
     company is to be supervised by the Board of Governors, such 
     company shall register with the Board of Governors, on forms 
     prescribed by the Board of Governors, which shall include 
     such information as the Board of Governors, in consultation 
     with the Council, may deem necessary or appropriate to carry 
     out this title.

     SEC. 115. ENHANCED SUPERVISION AND PRUDENTIAL STANDARDS FOR 
                   NONBANK FINANCIAL COMPANIES SUPERVISED BY THE 
                   BOARD OF GOVERNORS AND CERTAIN BANK HOLDING 
                   COMPANIES.

       (a) In General.--
       (1) Purpose.--In order to prevent or mitigate risks to the 
     financial stability of the

[[Page S3211]]

     United States that could arise from the material financial 
     distress or failure of large, interconnected financial 
     institutions, the Council may make recommendations to the 
     Board of Governors concerning the establishment and 
     refinement of prudential standards and reporting and 
     disclosure requirements applicable to nonbank financial 
     companies supervised by the Board of Governors and large, 
     interconnected bank holding companies, that--
       (A) are more stringent than those applicable to other 
     nonbank financial companies and bank holding companies that 
     do not present similar risks to the financial stability of 
     the United States; and
       (B) increase in stringency, based on the considerations 
     identified in subsection (b)(3).
       (2) Limitation on bank holding companies.--Any standards 
     recommended under subsections (b) through (f) shall not apply 
     to any bank holding company with total consolidated assets of 
     less than $50,000,000,000. The Council may recommend an asset 
     threshold greater than $50,000,000,000 for the applicability 
     of any particular standard under those subsections.
       (b) Development of Prudential Standards.--
       (1) In general.--The recommendations of the Council under 
     subsection (a) may include--
       (A) risk-based capital requirements;
       (B) leverage limits;
       (C) liquidity requirements;
       (D) resolution plan and credit exposure report 
     requirements;
       (E) concentration limits;
       (F) a contingent capital requirement;
       (G) enhanced public disclosures; and
       (H) overall risk management requirements.
       (2) Prudential standards for foreign financial companies.--
     In making recommendations concerning the standards set forth 
     in paragraph (1) that would apply to foreign nonbank 
     financial companies supervised by the Board of Governors or 
     foreign-based bank holding companies, the Council shall give 
     due regard to the principle of national treatment and 
     competitive equity.
       (3) Considerations.--In making recommendations concerning 
     prudential standards under paragraph (1), the Council shall--
       (A) take into account differences among nonbank financial 
     companies supervised by the Board of Governors and bank 
     holding companies described in subsection (a), based on--
       (i) the factors described in subsections (a) and (b) of 
     section 113;
       (ii) whether the company owns an insured depository 
     institution;
       (iii) nonfinancial activities and affiliations of the 
     company; and
       (iv) any other factors that the Council determines 
     appropriate; and
       (B) to the extent possible, ensure that small changes in 
     the factors listed in subsections (a) and (b) of section 113 
     would not result in sharp, discontinuous changes in the 
     prudential standards established under paragraph (1).
       (c) Contingent Capital.--
       (1) Study required.--The Council shall conduct a study of 
     the feasibility, benefits, costs, and structure of a 
     contingent capital requirement for nonbank financial 
     companies supervised by the Board of Governors and bank 
     holding companies described in subsection (a), which study 
     shall include--
       (A) an evaluation of the degree to which such requirement 
     would enhance the safety and soundness of companies subject 
     to the requirement, promote the financial stability of the 
     United States, and reduce risks to United States taxpayers;
       (B) an evaluation of the characteristics and amounts of 
     convertible debt that should be required;
       (C) an analysis of potential prudential standards that 
     should be used to determine whether the contingent capital of 
     a company would be converted to equity in times of financial 
     stress;
       (D) an evaluation of the costs to companies, the effects on 
     the structure and operation of credit and other financial 
     markets, and other economic effects of requiring contingent 
     capital;
       (E) an evaluation of the effects of such requirement on the 
     international competitiveness of companies subject to the 
     requirement and the prospects for international coordination 
     in establishing such requirement; and
       (F) recommendations for implementing regulations.
       (2) Report.--The Council shall submit a report to Congress 
     regarding the study required by paragraph (1) not later than 
     2 years after the date of enactment of this Act.
       (3) Recommendations.--
       (A) In general.--Subsequent to submitting a report to 
     Congress under paragraph (2), the Council may make 
     recommendations to the Board of Governors to require any 
     nonbank financial company supervised by the Board of 
     Governors and any bank holding company described in 
     subsection (a) to maintain a minimum amount of long-term 
     hybrid debt that is convertible to equity in times of 
     financial stress.
       (B) Factors to consider.--In making recommendations under 
     this subsection, the Council shall consider--
       (i) an appropriate transition period for implementation of 
     a conversion under this subsection;
       (ii) the factors described in subsection (b)(3);
       (iii) capital requirements applicable to a nonbank 
     financial company supervised by the Board of Governors or a 
     bank holding company described in subsection (a), and 
     subsidiaries thereof;
       (iv) results of the study required by paragraph (1); and
       (v) any other factor that the Council deems appropriate.
       (d) Resolution Plan and Credit Exposure Reports.--
       (1) Resolution plan.--The Council may make recommendations 
     to the Board of Governors concerning the requirement that 
     each nonbank financial company supervised by the Board of 
     Governors and each bank holding company described in 
     subsection (a) report periodically to the Council, the Board 
     of Governors, and the Corporation, the plan of such company 
     for rapid and orderly resolution in the event of material 
     financial distress or failure.
       (2) Credit exposure report.--The Council may make 
     recommendations to the Board of Governors concerning the 
     advisability of requiring each nonbank financial company 
     supervised by the Board of Governors and bank holding company 
     described in subsection (a) to report periodically to the 
     Council, the Board of Governors, and the Corporation on--
       (A) the nature and extent to which the company has credit 
     exposure to other significant nonbank financial companies and 
     significant bank holding companies; and
       (B) the nature and extent to which other such significant 
     nonbank financial companies and significant bank holding 
     companies have credit exposure to that company.
       (e) Concentration Limits.--In order to limit the risks that 
     the failure of any individual company could pose to nonbank 
     financial companies supervised by the Board of Governors or 
     bank holding companies described in subsection (a), the 
     Council may make recommendations to the Board of Governors to 
     prescribe standards to limit such risks, as set forth in 
     section 165.
       (f) Enhanced Public Disclosures.--The Council may make 
     recommendations to the Board of Governors to require periodic 
     public disclosures by bank holding companies described in 
     subsection (a) and by nonbank financial companies supervised 
     by the Board of Governors, in order to support market 
     evaluation of the risk profile, capital adequacy, and risk 
     management capabilities thereof.

     SEC. 116. REPORTS.

       (a) In General.--Subject to subsection (b), the Council, 
     acting through the Office of Financial Research, may require 
     a bank holding company with total consolidated assets of 
     $50,000,000,000 or greater or a nonbank financial company 
     supervised by the Board of Governors, and any subsidiary 
     thereof, to submit certified reports to keep the Council 
     informed as to--
       (1) the financial condition of the company;
       (2) systems for monitoring and controlling financial, 
     operating, and other risks;
       (3) transactions with any subsidiary that is a depository 
     institution; and
       (4) the extent to which the activities and operations of 
     the company and any subsidiary thereof, could, under adverse 
     circumstances, have the potential to disrupt financial 
     markets or affect the overall financial stability of the 
     United States.
       (b) Use of Existing Reports.--
       (1) In general.--For purposes of compliance with subsection 
     (a), the Council, acting through the Office of Financial 
     Research, shall, to the fullest extent possible, use--
       (A) reports that a bank holding company, nonbank financial 
     company supervised by the Board of Governors, or any 
     functionally regulated subsidiary of such company has been 
     required to provide to other Federal or State regulatory 
     agencies;
       (B) information that is otherwise required to be reported 
     publicly; and
       (C) externally audited financial statements.
       (2) Availability.--Each bank holding company described in 
     subsection (a) and nonbank financial company supervised by 
     the Board of Governors, and any subsidiary thereof, shall 
     provide to the Council, at the request of the Council, copies 
     of all reports referred to in paragraph (1).
       (3) Confidentiality.--The Council shall maintain the 
     confidentiality of the reports obtained under subsection (a) 
     and paragraph (1)(A) of this subsection.

     SEC. 117. TREATMENT OF CERTAIN COMPANIES THAT CEASE TO BE 
                   BANK HOLDING COMPANIES.

       (a) Applicability.--This section shall apply to any entity 
     or a successor entity that--
       (1) was a bank holding company having total consolidated 
     assets equal to or greater than $50,000,000,000 as of January 
     1, 2010; and
       (2) received financial assistance under or participated in 
     the Capital Purchase Program established under the Troubled 
     Asset Relief Program authorized by the Emergency Economic 
     Stabilization Act of 2008.
       (b) Treatment.--If an entity described in subsection (a) 
     ceases to be a bank holding company at any time after January 
     1, 2010, then such entity shall be treated as a nonbank 
     financial company supervised by the Board of Governors, as if 
     the Council had made a determination under section 113 with 
     respect to that entity.
       (c) Appeal.--
       (1) Request for hearing.--An entity may request, in 
     writing, an opportunity for a written or oral hearing before 
     the Council to

[[Page S3212]]

     appeal its treatment as a nonbank financial company 
     supervised by the Board of Governors in accordance with this 
     section. Upon receipt of the request, the Council shall fix a 
     time (not later than 30 days after the date of receipt of the 
     request) and place at which such entity may appear, 
     personally or through counsel, to submit written materials 
     (or, at the sole discretion of the Council, oral testimony 
     and oral argument).
       (2) Decision.--
       (A) Proposed decision.--Not later than 60 days after the 
     date of a hearing under paragraph (1), the Council shall 
     submit a report to, and may testify before, the Committee on 
     Banking, Housing, and Urban Affairs of the Senate and the 
     Committee on Financial Services of the House of 
     Representatives on the proposed decision of the Council 
     regarding an appeal under paragraph (1), which report shall 
     include a statement of the basis for the proposed decision of 
     the Council.
       (B) Notice of final decision.--The Council shall notify the 
     subject entity of the final decision of the Council regarding 
     an appeal under paragraph (1), which notice shall contain a 
     statement of the basis for the final decision of the Council, 
     not later than 60 days after the later of--
       (i) the date of the submission of the report under 
     subparagraph (A); or
       (ii) if the Committee on Banking, Housing, and Urban 
     Affairs of the Senate or the Committee on Financial Services 
     of the House of Representatives holds one or more hearings 
     regarding such report, the date of the last such hearing.
       (C) Considerations.--In making a decision regarding an 
     appeal under paragraph (1), the Council shall consider 
     whether the company meets the standards under section 113(a) 
     or 113(b), as applicable, and the definition of the term 
     ``nonbank financial company'' under section 102. The decision 
     of the Council shall be final, subject to the review under 
     paragraph (3).
       (3) Review.--If the Council denies an appeal under this 
     subsection, the Council shall, not less frequently than 
     annually, review and reevaluate the decision.

     SEC. 118. COUNCIL FUNDING.

       Any expenses of the Council and the Office of Financial 
     Research shall be treated as expenses of, and paid by, the 
     Department of the Treasury.

     SEC. 119. RESOLUTION OF SUPERVISORY JURISDICTIONAL DISPUTES 
                   AMONG MEMBER AGENCIES.

       (a) Request for Dispute Resolution.--The Council shall 
     resolve a dispute among 2 or more member agencies, if--
       (1) a member agency has a dispute with another member 
     agency about the respective jurisdiction over a particular 
     bank holding company, nonbank financial company, or financial 
     activity or product (excluding matters for which another 
     dispute mechanism specifically has been provided under 
     Federal law);
       (2) the Council determines that the disputing agencies 
     cannot, after a demonstrated good faith effort, resolve the 
     dispute without the intervention of the Council; and
       (3) any of the member agencies involved in the dispute--
       (A) provides all other disputants prior notice of the 
     intent to request dispute resolution by the Council; and
       (B) requests in writing, not earlier than 14 days after 
     providing the notice described in subparagraph (A), that the 
     Council resolve the dispute.
       (b) Council Decision.--The Council shall resolve each 
     dispute described in subsection (a)--
       (1) within a reasonable time after receiving the dispute 
     resolution request;
       (2) after consideration of relevant information provided by 
     each agency party to the dispute; and
       (3) by agreeing with 1 of the disputants regarding the 
     entirety of the matter, or by determining a compromise 
     position.
       (c) Form and Binding Effect.--A Council decision under this 
     section shall--
       (1) be in writing;
       (2) include an explanation of the reasons therefor; and
       (3) be binding on all Federal agencies that are parties to 
     the dispute.

     SEC. 120. ADDITIONAL STANDARDS APPLICABLE TO ACTIVITIES OR 
                   PRACTICES FOR FINANCIAL STABILITY PURPOSES.

       (a) In General.--The Council may issue recommendations to 
     the primary financial regulatory agencies to apply new or 
     heightened standards and safeguards, including standards 
     enumerated in section 115, for a financial activity or 
     practice conducted by bank holding companies or nonbank 
     financial companies under their respective jurisdictions, if 
     the Council determines that the conduct of such activity or 
     practice could create or increase the risk of significant 
     liquidity, credit, or other problems spreading among bank 
     holding companies and nonbank financial companies or the 
     financial markets of the United States.
       (b) Procedure for Recommendations to Regulators.--
       (1) Notice and opportunity for comment.--The Council shall 
     consult with the primary financial regulatory agencies and 
     provide notice to the public and opportunity for comment for 
     any proposed recommendation that the primary financial 
     regulatory agencies apply new or heightened standards and 
     safeguards for a financial activity or practice.
       (2) Criteria.--The new or heightened standards and 
     safeguards for a financial activity or practice recommended 
     under paragraph (1)--
       (A) shall take costs to long-term economic growth into 
     account; and
       (B) may include prescribing the conduct of the activity or 
     practice in specific ways (such as by limiting its scope, or 
     applying particular capital or risk management requirements 
     to the conduct of the activity) or prohibiting the activity 
     or practice.
       (c) Implementation of Recommended Standards.--
       (1) Role of primary financial regulatory agency.--
       (A) In general.--Each primary financial regulatory agency 
     may impose, require reports regarding, examine for compliance 
     with, and enforce standards in accordance with this section 
     with respect to those entities for which it is the primary 
     financial regulatory agency.
       (B) Rule of construction.--The authority under this 
     paragraph is in addition to, and does not limit, any other 
     authority of a primary financial regulatory agency. 
     Compliance by an entity with actions taken by a primary 
     financial regulatory agency under this section shall be 
     enforceable in accordance with the statutes governing the 
     respective jurisdiction of the primary financial regulatory 
     agency over the entity, as if the agency action were taken 
     under those statutes.
       (2) Imposition of standards.--The primary financial 
     regulatory agency shall impose the standards recommended by 
     the Council in accordance with subsection (a), or similar 
     standards that the Council deems acceptable, or shall explain 
     in writing to the Council, not later than 90 days after the 
     date on which the Council issues the recommendation, why the 
     agency has determined not to follow the recommendation of the 
     Council.
       (d) Report to Congress.--The Council shall report to 
     Congress on--
       (1) any recommendations issued by the Council under this 
     section;
       (2) the implementation of, or failure to implement such 
     recommendation on the part of a primary financial regulatory 
     agency; and
       (3) in any case in which no primary financial regulatory 
     agency exists for the nonbank financial company conducting 
     financial activities or practices referred to in subsection 
     (a), recommendations for legislation that would prevent such 
     activities or practices from threatening the stability of the 
     financial system of the United States.
       (e) Effect of Rescission of Identification.--
       (1) Notice.--The Council may recommend to the relevant 
     primary financial regulatory agency that a financial activity 
     or practice no longer requires any standards or safeguards 
     implemented under this section.
       (2) Determination of primary financial regulatory agency to 
     continue.--
       (A) In general.--Upon receipt of a recommendation under 
     paragraph (1), a primary financial regulatory agency that has 
     imposed standards under this section shall determine whether 
     standards that it has imposed under this section should 
     remain in effect.
       (B) Appeal process.--Each primary financial regulatory 
     agency that has imposed standards under this section shall 
     promulgate regulations to establish a procedure under which 
     entities under its jurisdiction may appeal a determination by 
     such agency under this paragraph that standards imposed under 
     this section should remain in effect.

     SEC. 121. MITIGATION OF RISKS TO FINANCIAL STABILITY.

       (a) Mitigatory Actions.--If the Board of Governors 
     determines that a bank holding company with total 
     consolidated assets of $50,000,000,000 or more, or a nonbank 
     financial company supervised by the Board of Governors, poses 
     a grave threat to the financial stability of the United 
     States, the Board of Governors, upon an affirmative vote of 
     not fewer than \2/3\ of the Council members then serving, 
     shall require the subject company--
       (1) to terminate one or more activities;
       (2) to impose conditions on the manner in which the company 
     conducts one or more activities; or
       (3) if the Board of Governors determines that such action 
     is inadequate to mitigate a threat to the financial stability 
     of the United States in its recommendation, to sell or 
     otherwise transfer assets or off-balance-sheet items to 
     unaffiliated entities.
       (b) Notice and Hearing.--
       (1) In general.--The Board of Governors, in consultation 
     with the Council, shall provide to a company described in 
     subsection (a) written notice that such company is being 
     considered for mitigatory action pursuant to this section, 
     including an explanation of the basis for, and description 
     of, the proposed mitigatory action.
       (2) Hearing.--Not later than 30 days after the date of 
     receipt of notice under paragraph (1), the company may 
     request, in writing, an opportunity for a written or oral 
     hearing before the Board of Governors to contest the proposed 
     mitigatory action. Upon receipt of a timely request, the 
     Board of Governors shall fix a time (not later than 30 days 
     after the date of receipt of the request) and place at which 
     such company may appear, personally or through counsel, to 
     submit written materials (or, at the discretion of the Board 
     of Governors, in consultation with the Council, oral 
     testimony and oral argument).
       (3) Decision.--Not later than 60 days after the date of a 
     hearing under paragraph (2), or not later than 60 days after 
     the provision of a notice under paragraph (1) if no hearing

[[Page S3213]]

     was held, the Board of Governors shall notify the company of 
     the final decision of the Board of Governors, including the 
     results of the vote of the Council, as described in 
     subsection (a).
       (c) Factors for Consideration.--The Board of Governors and 
     the Council shall take into consideration the factors set 
     forth in subsection (a) or (b) of section 113, as applicable, 
     in a determination described in subsection (a) and in a 
     decision described in subsection (b).
       (d) Application to Foreign Financial Companies.--The Board 
     of Governors may prescribe regulations regarding the 
     application of this section to foreign nonbank financial 
     companies supervised by the Board of Governors and foreign-
     based bank holding companies, giving due regard to the 
     principle of national treatment and competitive equity.

                Subtitle B--Office of Financial Research

     SEC. 151. DEFINITIONS.

       For purposes of this subtitle--
       (1) the terms ``Office'' and ``Director'' mean the Office 
     of Financial Research established under this subtitle and the 
     Director thereof, respectively;
       (2) the term ``financial company'' has the same meaning as 
     in title II, and includes an insured depository institution 
     and an insurance company;
       (3) the term ``Research and Analysis Center'' means the 
     research and analysis center established under section 154;
       (4) the term ``financial transaction data'' means the 
     structure and legal description of a financial contract, with 
     sufficient detail to describe the rights and obligations 
     between counterparties and make possible an independent 
     valuation;
       (5) the term ``position data''--
       (A) means data on financial assets or liabilities held on 
     the balance sheet of a financial company, where positions are 
     created or changed by the execution of a financial 
     transaction; and
       (B) includes information that identifies counterparties, 
     the valuation by the financial company of the position, and 
     information that makes possible an independent valuation of 
     the position;
       (6) the term ``financial contract'' means a legally binding 
     agreement between 2 or more counterparties, describing rights 
     and obligations relating to the future delivery of items of 
     intrinsic or extrinsic value among the counterparties; and
       (7) the term ``financial instrument'' means a financial 
     contract in which the terms and conditions are publicly 
     available, and the roles of one or more of the counterparties 
     are assignable without the consent of any of the other 
     counterparties (including common stock of a publicly traded 
     company, government bonds, or exchange traded futures and 
     options contracts).

     SEC. 152. OFFICE OF FINANCIAL RESEARCH ESTABLISHED.

       (a) Establishment.--There is established within the 
     Department of the Treasury the Office of Financial Research.
       (b) Director.--
       (1) In general.--The Office shall be headed by a Director, 
     who shall be appointed by the President, by and with the 
     advice and consent of the Senate.
       (2) Term of service.--The Director shall serve for a term 
     of 6 years, except that, in the event that a successor is not 
     nominated and confirmed by the end of the term of service of 
     a Director, the Director may continue to serve until such 
     time as the next Director is appointed and confirmed.
       (3) Executive level.--The Director shall be compensated at 
     level III of the Executive Schedule.
       (4) Prohibition on dual service.--The individual serving in 
     the position of Director may not, during such service, also 
     serve as the head of any financial regulatory agency.
       (5) Responsibilities, duties, and authority.--The Director 
     shall have sole discretion in the manner in which the 
     Director fulfills the responsibilities and duties and 
     exercises the authorities described in this subtitle.
       (c) Budget.--The Director, with the approval of the 
     Chairperson, shall establish the annual budget of the Office.
       (d) Office Personnel.--
       (1) In general.--The Director, with approval of the 
     Chairperson, may fix the number of, and appoint and direct, 
     all employees of the Office.
       (2) Compensation.--The Director, in consultation with the 
     Chairperson, shall fix, adjust, and administer the pay for 
     all employees of the Office.
       (e) Assistance From Federal Agencies.--Any department or 
     agency of the United States may provide to the Office and any 
     special advisory, technical, or professional committees 
     appointed by the Office, such services, funds, facilities, 
     staff, and other support services as the Office may determine 
     advisable. Any Federal Government employee may be detailed to 
     the Office without reimbursement, and such detail shall be 
     without interruption or loss of civil service status or 
     privilege.
       (f) Non-Compete.--The Director and any staff of the Office 
     who has had access to the transaction or position data or 
     other business confidential information about financial 
     entities required to report to the Office, may not, for a 
     period of 1 year after last having access to such transaction 
     or position data or business confidential information, be 
     employed by or provide advice or consulting services to a 
     financial company, regardless of whether that entity is 
     required to report to the Office. For staff whose access to 
     business confidential information was limited, the Director 
     may provide, on a case-by-case basis, for a shorter period of 
     post-employment prohibition, provided that the shorter period 
     does not compromise business confidential information.
       (g) Executive Schedule Compensation.--Section 5314 of title 
     5, United States Code, is amended by adding at the end the 
     following new item:
       ``Director of the Office of Financial Research.''.

     SEC. 153. PURPOSE AND DUTIES OF THE OFFICE.

       (a) Purpose and Duties.--The purpose of the Office is to 
     support the Council in fulfilling the purposes and duties of 
     the Council, as set forth in subtitle A, and to support 
     member agencies, by--
       (1) collecting data on behalf of the Council, and providing 
     such data to the Council and member agencies;
       (2) standardizing the types and formats of data reported 
     and collected;
       (3) performing applied research and essential long-term 
     research;
       (4) developing tools for risk measurement and monitoring;
       (5) performing other related services;
       (6) making the results of the activities of the Office 
     available to financial regulatory agencies; and
       (7) assisting such member agencies in determining the types 
     and formats of data authorized by this Act to be collected by 
     such member agencies.
       (b) Administrative Authority.--The Office may share data 
     and information, including software developed by the Office, 
     with the Council and member agencies, which shared data, 
     information, and software--
       (1) shall be maintained with at least the same level of 
     security as is used by the Office; and
       (2) may not be shared with any individual or entity.
       (c) Guidance.--
       (1) Scope.--The Office, in consultation with the 
     Chairperson, shall issue guidance to carry out the purposes 
     and duties described in paragraphs (1), (2), and (7) of 
     subsection (a).
       (2) Standardization.--Member agencies, in consultation with 
     the Office, shall work to standardize the types and formats 
     of data reported and collected on behalf of the Council, as 
     described in subsection (a)(2).
       (d) Testimony.--The Director of the Office shall report to 
     and testify before the Committee on Banking, Housing, and 
     Urban Affairs of the Senate and the Committee on Financial 
     Services of the House of Representatives annually on the 
     activities of the Office, including the work of the Data 
     Center and the Research and Analysis Center, and the 
     assessment of the Office of significant financial market 
     developments and potential emerging threats to the financial 
     stability of the United States.
       (e) Additional Reports.--The Director may, with the 
     approval of the Chairperson, provide additional reports to 
     Congress concerning the financial stability of the United 
     States.

     SEC. 154. ORGANIZATIONAL STRUCTURE; RESPONSIBILITIES OF 
                   RESEARCH AND ANALYSIS CENTER.

       (a) In General.--There is established within the Office, to 
     carry out the programmatic responsibilities of the Office, 
     the Research and Analysis Center.
       (b) Research and Analysis Center.--The Research and 
     Analysis Center, on behalf of the Council, shall develop and 
     maintain independent analytical capabilities and computing 
     resources to develop and maintain metrics and reporting 
     systems for risks to the financial stability of the United 
     States.
       (c) Reporting Responsibilities.--
       (1) Required reports.--Not later than 2 years after the 
     date of enactment of this Act, and not later than 120 days 
     after the end of each fiscal year thereafter, the Office 
     shall prepare and submit a report to Congress.
       (2) Content.--Each report required by this subsection shall 
     assess the state of the United States financial system, 
     including--
       (A) an analysis of any threats to the financial stability 
     of the United States;
       (B) the status of the efforts of the Office in meeting the 
     mission of the Office; and
       (C) key findings from the research and analysis of the 
     financial system by the Office.

     SEC. 155. TRANSITION OVERSIGHT.

       (a) Purpose.--The purpose of this section is to ensure that 
     the Office--
       (1) has an orderly and organized startup;
       (2) attracts and retains a qualified workforce; and
       (3) establishes comprehensive employee training and 
     benefits programs.
       (b) Reporting Requirement.--
       (1) In general.--The Office shall submit an annual report 
     to the Committee on Banking, Housing, and Urban Affairs of 
     the Senate and the Committee on Financial Services of the 
     House of Representatives that includes the plans described in 
     paragraph (2).
       (2) Plans.--The plans described in this paragraph are as 
     follows:
       (A) Training and workforce development plan.--The Office 
     shall submit a training and workforce development plan that 
     includes, to the extent practicable--
       (i) identification of skill and technical expertise needs 
     and actions taken to meet those requirements;
       (ii) steps taken to foster innovation and creativity;

[[Page S3214]]

       (iii) leadership development and succession planning; and
       (iv) effective use of technology by employees.
       (B) Recruitment and retention plan.--The Office shall 
     submit a recruitment and retention plan that includes, to the 
     extent practicable, provisions relating to--
       (i) the steps necessary to target highly qualified 
     applicant pools with diverse backgrounds;
       (ii) streamlined employment application processes;
       (iii) the provision of timely notification of the status of 
     employment applications to applicants; and
       (iv) the collection of information to measure indicators of 
     hiring effectiveness.
       (c) Rule of Construction.--Nothing in this section may be 
     construed to affect--
       (1) a collective bargaining agreement, as that term is 
     defined in section 7103(a)(8) of title 5, United States Code, 
     that is in effect on the date of enactment of this Act; or
       (2) the rights of employees under chapter 71 of title 5, 
     United States Code.

Subtitle C--Additional Board of Governors Authority for Certain Nonbank 
             Financial Companies and Bank Holding Companies

     SEC. 161. REPORTS BY AND EXAMINATIONS OF NONBANK FINANCIAL 
                   COMPANIES BY THE BOARD OF GOVERNORS.

       (a) Reports.--
       (1) In general.--The Board of Governors may require each 
     nonbank financial company supervised by the Board of 
     Governors, and any subsidiary thereof, to submit reports 
     under oath, to keep the Board of Governors informed as to--
       (A) the financial condition of the company or subsidiary, 
     systems of the company or subsidiary for monitoring and 
     controlling financial, operating, and other risks, and the 
     extent to which the activities and operations of the company 
     or subsidiary pose a threat to the financial stability of the 
     United States; and
       (B) compliance by the company or subsidiary with the 
     requirements of this subtitle.
       (2) Use of existing reports and information.--In carrying 
     out subsection (a), the Board of Governors shall, to the 
     fullest extent possible, use--
       (A) reports and supervisory information that a nonbank 
     financial company or subsidiary thereof has been required to 
     provide to other Federal or State regulatory agencies;
       (B) information otherwise obtainable from Federal or State 
     regulatory agencies;
       (C) information that is otherwise required to be reported 
     publicly; and
       (D) externally audited financial statements of such company 
     or subsidiary.
       (3) Availability.--Upon the request of the Board of 
     Governors, a nonbank financial company supervised by the 
     Board of Governors, or a subsidiary thereof, shall promptly 
     provide to the Board of Governors any information described 
     in paragraph (2).
       (b) Examinations.--
       (1) In general.--Subject to paragraph (2), the Board of 
     Governors may examine any nonbank financial company 
     supervised by the Board of Governors and any subsidiary of 
     such company, to determine--
       (A) the nature of the operations and financial condition of 
     the company and such subsidiary;
       (B) the financial, operational, and other risks within the 
     company that may pose a threat to the safety and soundness of 
     such company or to the financial stability of the United 
     States;
       (C) the systems for monitoring and controlling such risks; 
     and
       (D) compliance by the company with the requirements of this 
     subtitle.
       (2) Use of examination reports and information.--For 
     purposes of this subsection, the Board of Governors shall, to 
     the fullest extent possible, rely on reports of examination 
     of any depository institution subsidiary or functionally 
     regulated subsidiary made by the primary financial regulatory 
     agency for that subsidiary, and on information described in 
     subsection (a)(2).
       (c) Coordination With Primary Financial Regulatory 
     Agency.--The Board of Governors shall--
       (1) provide to the primary financial regulatory agency for 
     any company or subsidiary, reasonable notice before requiring 
     a report, requesting information, or commencing an 
     examination of such subsidiary under this section; and
       (2) avoid duplication of examination activities, reporting 
     requirements, and requests for information, to the extent 
     possible.

     SEC. 162. ENFORCEMENT.

       (a) In General.--Except as provided in subsection (b), a 
     nonbank financial company supervised by the Board of 
     Governors and any subsidiaries of such company (other than 
     any depository institution subsidiary) shall be subject to 
     the provisions of subsections (b) through (n) of section 8 of 
     the Federal Deposit Insurance Act (12 U.S.C. 1818), in the 
     same manner and to the same extent as if the company were a 
     bank holding company, as provided in section 8(b)(3) of the 
     Federal Deposit Insurance Act (12 U.S.C. 1818(b)(3)).
       (b) Enforcement Authority for Functionally Regulated 
     Subsidiaries.--
       (1) Referral.--If the Board of Governors determines that a 
     condition, practice, or activity of a depository institution 
     subsidiary or functionally regulated subsidiary of a nonbank 
     financial company supervised by the Board of Governors does 
     not comply with the regulations or orders prescribed by the 
     Board of Governors under this Act, or otherwise poses a 
     threat to the financial stability of the United States, the 
     Board of Governors may recommend, in writing, to the primary 
     financial regulatory agency for the subsidiary that such 
     agency initiate a supervisory action or enforcement 
     proceeding. The recommendation shall be accompanied by a 
     written explanation of the concerns giving rise to the 
     recommendation.
       (2) Back-up authority of the board of governors.--If, 
     during the 60-day period beginning on the date on which the 
     primary financial regulatory agency receives a recommendation 
     under paragraph (1), the primary financial regulatory agency 
     does not take supervisory or enforcement action against a 
     subsidiary that is acceptable to the Board of Governors, the 
     Board of Governors (upon a vote of its members) may take the 
     recommended supervisory or enforcement action, as if the 
     subsidiary were a bank holding company subject to supervision 
     by the Board of Governors.

     SEC. 163. ACQUISITIONS.

       (a) Acquisitions of Banks; Treatment as a Bank Holding 
     Company.--For purposes of section 3 of the Bank Holding 
     Company Act of 1956 (12 U.S.C. 1842), a nonbank financial 
     company supervised by the Board of Governors shall be deemed 
     to be, and shall be treated as, a bank holding company.
       (b) Acquisition of Nonbank Companies.--
       (1) Prior notice for large acquisitions.--Notwithstanding 
     section 4(k)(6)(B) of the Bank Holding Company Act of 1956 
     (12 U.S.C. 1843(k)(6)(B)), a bank holding company with total 
     consolidated assets equal to or greater than $50,000,000,000 
     or a nonbank financial company supervised by the Board of 
     Governors shall not acquire direct or indirect ownership or 
     control of any voting shares of any company (other than an 
     insured depository institution) that is engaged in activities 
     described in section 4(k) of the Bank Holding Company Act of 
     1956 having total consolidated assets of $10,000,000,000 or 
     more, without providing written notice to the Board of 
     Governors in advance of the transaction.
       (2) Exemptions.--The prior notice requirement in paragraph 
     (1) shall not apply with regard to the acquisition of shares 
     that would qualify for the exemptions in section 4(c) or 
     section 4(k)(4)(E) of the Bank Holding Company Act of 1956 
     (12 U.S.C. 1843(c) and (k)(4)(E)).
       (3) Notice procedures.--The notice procedures set forth in 
     section 4(j)(1) of the Bank Holding Company Act of 1956 (12 
     U.S.C. 1843(j)(1)), without regard to section 4(j)(3) of that 
     Act, shall apply to an acquisition of any company (other than 
     an insured depository institution) by a bank holding company 
     with total consolidated assets equal to or greater than 
     $50,000,000,000 or a nonbank financial company supervised by 
     the Board of Governors, as described in paragraph (1), 
     including any such company engaged in activities described in 
     section 4(k) of that Act.
       (4) Standards for review.--In addition to the standards 
     provided in section 4(j)(2) of the Bank Holding Company Act 
     of 1956 (12 U.S.C. 1843(j)(2)), the Board of Governors shall 
     consider the extent to which the proposed acquisition would 
     result in greater or more concentrated risks to global or 
     United States financial stability or the United States 
     economy.

     SEC. 164. PROHIBITION AGAINST MANAGEMENT INTERLOCKS BETWEEN 
                   CERTAIN FINANCIAL COMPANIES.

       A nonbank financial company supervised by the Board of 
     Governors shall be treated as a bank holding company for 
     purposes of the Depository Institutions Management Interlocks 
     Act (12 U.S.C. 3201 et seq.), except that the Board of 
     Governors shall not exercise the authority provided in 
     section 7 of that Act (12 U.S.C. 3207) to permit service by a 
     management official of a nonbank financial company supervised 
     by the Board of Governors as a management official of any 
     bank holding company with total consolidated assets equal to 
     or greater than $50,000,000,000, or other nonaffiliated 
     nonbank financial company supervised by the Board of 
     Governors (other than to provide a temporary exemption for 
     interlocks resulting from a merger, acquisition, or 
     consolidation).

     SEC. 165. ENHANCED SUPERVISION AND PRUDENTIAL STANDARDS FOR 
                   NONBANK FINANCIAL COMPANIES SUPERVISED BY THE 
                   BOARD OF GOVERNORS AND CERTAIN BANK HOLDING 
                   COMPANIES.

       (a) In General.--
       (1) Purpose.--In order to prevent or mitigate risks to the 
     financial stability of the United States that could arise 
     from the material financial distress or failure of large, 
     interconnected financial institutions, the Board of Governors 
     shall, on its own or pursuant to recommendations by the 
     Council under section 115, establish prudential standards and 
     reporting and disclosure requirements applicable to nonbank 
     financial companies supervised by the Board of Governors and 
     large, interconnected bank holding companies that--
       (A) are more stringent than the standards and requirements 
     applicable to nonbank financial companies and bank holding 
     companies that do not present similar risks to the financial 
     stability of the United States; and
       (B) increase in stringency, based on the considerations 
     identified in subsection (b)(3).
       (2) Limitation on bank holding companies.--Any standards 
     established under subsections (b) through (f) shall not apply 
     to

[[Page S3215]]

     any bank holding company with total consolidated assets of 
     less than $50,000,000,000, but the Board of Governors may 
     establish an asset threshold greater than $50,000,000,000 for 
     the applicability of any particular standard under 
     subsections (b) through (f).
       (b) Development of Prudential Standards.--
       (1) In general.--
       (A) Required standards.--The Board of Governors shall, by 
     regulation or order, establish prudential standards for 
     nonbank financial companies supervised by the Board of 
     Governors and bank holding companies described in subsection 
     (a), that shall include--
       (i) risk-based capital requirements;
       (ii) leverage limits;
       (iii) liquidity requirements;
       (iv) resolution plan and credit exposure report 
     requirements; and
       (v) concentration limits.
       (B) Additional standards authorized.--The Board of 
     Governors may, by regulation or order, establish prudential 
     standards for nonbank financial companies supervised by the 
     Board of Governors and bank holding companies described in 
     subsection (a), that include--
       (i) a contingent capital requirement;
       (ii) enhanced public disclosures; and
       (iii) overall risk management requirements.
       (2) Prudential standards for foreign financial companies.--
     In applying the standards set forth in paragraph (1) to 
     foreign nonbank financial companies supervised by the Board 
     of Governors and to foreign-based bank holding companies, the 
     Board of Governors shall give due regard to the principle of 
     national treatment and competitive equity.
       (3) Considerations.--In prescribing prudential standards 
     under paragraph (1), the Board of Governors shall--
       (A) take into account differences among nonbank financial 
     companies supervised by the Board of Governors and bank 
     holding companies described in subsection (a), based on--
       (i) the factors described in subsections (a) and (b) of 
     section 113;
       (ii) whether the company owns an insured depository 
     institution;
       (iii) nonfinancial activities and affiliations of the 
     company; and
       (iv) any other factors that the Board of Governors 
     determines appropriate;
       (B) to the extent possible, ensure that small changes in 
     the factors listed in subsections (a) and (b) of section 113 
     would not result in sharp, discontinuous changes in the 
     prudential standards established under paragraph (1) of this 
     subsection; and
       (C) take into account any recommendations of the Council 
     under section 115.
       (4) Report.--The Board of Governors shall submit an annual 
     report to Congress regarding the implementation of the 
     prudential standards required pursuant to paragraph (1), 
     including the use of such standards to mitigate risks to the 
     financial stability of the United States.
       (c) Contingent Capital.--
       (1) In general.--Subsequent to submission by the Council of 
     a report to Congress under section 115(c), the Board of 
     Governors may promulgate regulations that require each 
     nonbank financial company supervised by the Board of 
     Governors and bank holding companies described in subsection 
     (a) to maintain a minimum amount of long-term hybrid debt 
     that is convertible to equity in times of financial stress.
       (2) Factors to consider.--In establishing regulations under 
     this subsection, the Board of Governors shall consider--
       (A) the results of the study undertaken by the Council, and 
     any recommendations of the Council, under section 115(c);
       (B) an appropriate transition period for implementation of 
     a conversion under this subsection;
       (C) the factors described in subsection (b)(3)(A);
       (D) capital requirements applicable to the nonbank 
     financial company supervised by the Board of Governors or a 
     bank holding company described in subsection (a), and 
     subsidiaries thereof; and
       (E) any other factor that the Board of Governors deems 
     appropriate.
       (d) Resolution Plan and Credit Exposure Reports.--
       (1) Resolution plan.--The Board of Governors shall require 
     each nonbank financial company supervised by the Board of 
     Governors and bank holding companies described in subsection 
     (a) to report periodically to the Board of Governors, the 
     Council, and the Corporation the plan of such company for 
     rapid and orderly resolution in the event of material 
     financial distress or failure.
       (2) Credit exposure report.--The Board of Governors shall 
     require each nonbank financial company supervised by the 
     Board of Governors and bank holding companies described in 
     subsection (a) to report periodically to the Board of 
     Governors, the Council, and the Corporation on--
       (A) the nature and extent to which the company has credit 
     exposure to other significant nonbank financial companies and 
     significant bank holding companies; and
       (B) the nature and extent to which other significant 
     nonbank financial companies and significant bank holding 
     companies have credit exposure to that company.
       (3) Review.--The Board of Governors and the Corporation 
     shall review the information provided in accordance with this 
     section by each nonbank financial company supervised by the 
     Board of Governors and bank holding company described in 
     subsection (a).
       (4) Notice of deficiencies.--If the Board of Governors and 
     the Corporation jointly determine, based on their review 
     under paragraph (3), that the resolution plan of a nonbank 
     financial company supervised by the Board of Governors or a 
     bank holding company described in subsection (a) is not 
     credible or would not facilitate an orderly resolution of the 
     company under title 11, United States Code--
       (A) the Board of Governors and the Corporation shall notify 
     the company, as applicable, of the deficiencies in the 
     resolution plan; and
       (B) the company shall resubmit the resolution plan within a 
     time frame determined by the Board of Governors and the 
     Corporation, with revisions demonstrating that the plan is 
     credible and would result in an orderly resolution under 
     title 11, United States Code, including any proposed changes 
     in business operations and corporate structure to facilitate 
     implementation of the plan.
       (5) Failure to resubmit credible plan.--
       (A) In general.--If a nonbank financial company supervised 
     by the Board of Governors or a bank holding company described 
     in subsection (a) fails to timely resubmit the resolution 
     plan as required under paragraph (4), with such revisions as 
     are required under subparagraph (B), the Board of Governors 
     and the Corporation may jointly impose more stringent 
     capital, leverage, or liquidity requirements, or restrictions 
     on the growth, activities, or operations of the company, or 
     any subsidiary thereof, until such time as the company 
     resubmits a plan that remedies the deficiencies.
       (B) Divestiture.--The Board of Governors and the 
     Corporation, in consultation with the Council, may direct a 
     nonbank financial company supervised by the Board of 
     Governors or a bank holding company described in subsection 
     (a), by order, to divest certain assets or operations 
     identified by the Board of Governors and the Corporation, to 
     facilitate an orderly resolution of such company under title 
     11, United States Code, in the event of the failure of such 
     company, in any case in which--
       (i) the Board of Governors and the Corporation have jointly 
     imposed more stringent requirements on the company pursuant 
     to subparagraph (A); and
       (ii) the company has failed, within the 2-year period 
     beginning on the date of the imposition of such requirements 
     under subparagraph (A), to resubmit the resolution plan with 
     such revisions as were required under paragraph (4)(B).
       (6) Rules.--Not later than 18 months after the date of 
     enactment of this Act, the Board of Governors and the 
     Corporation shall jointly issue final rules implementing this 
     subsection.
       (e) Concentration Limits.--
       (1) Standards.--In order to limit the risks that the 
     failure of any individual company could pose to a nonbank 
     financial company supervised by the Board of Governors or a 
     bank holding company described in subsection (a), the Board 
     of Governors, by regulation, shall prescribe standards that 
     limit such risks.
       (2) Limitation on credit exposure.--The regulations 
     prescribed by the Board of Governors under paragraph (1) 
     shall prohibit each nonbank financial company supervised by 
     the Board of Governors and bank holding company described in 
     subsection (a) from having credit exposure to any 
     unaffiliated company that exceeds 25 percent of the capital 
     stock and surplus (or such lower amount as the Board of 
     Governors may determine by regulation to be necessary to 
     mitigate risks to the financial stability of the United 
     States) of the company.
       (3) Credit exposure.--For purposes of paragraph (2), 
     ``credit exposure'' to a company means--
       (A) all extensions of credit to the company, including 
     loans, deposits, and lines of credit;
       (B) all repurchase agreements and reverse repurchase 
     agreements with the company;
       (C) all securities borrowing and lending transactions with 
     the company, to the extent that such transactions create 
     credit exposure for the nonbank financial company supervised 
     by the Board of Governors or a bank holding company described 
     in subsection (a);
       (D) all guarantees, acceptances, or letters of credit 
     (including endorsement or standby letters of credit) issued 
     on behalf of the company;
       (E) all purchases of or investment in securities issued by 
     the company;
       (F) counterparty credit exposure to the company in 
     connection with a derivative transaction between the nonbank 
     financial company supervised by the Board of Governors or a 
     bank holding company described in subsection (a) and the 
     company; and
       (G) any other similar transactions that the Board of 
     Governors, by regulation, determines to be a credit exposure 
     for purposes of this section.
       (4) Attribution rule.--For purposes of this subsection, any 
     transaction by a nonbank financial company supervised by the 
     Board of Governors or a bank holding company described in 
     subsection (a) with any person is a transaction with a 
     company, to the extent that the proceeds of the transaction 
     are used for the benefit of, or transferred to, that company.

[[Page S3216]]

       (5) Rulemaking.--The Board of Governors may issue such 
     regulations and orders, including definitions consistent with 
     this section, as may be necessary to administer and carry out 
     this subsection.
       (6) Exemptions.--The Board of Governors may, by regulation 
     or order, exempt transactions, in whole or in part, from the 
     definition of ``credit exposure'' for purposes of this 
     subsection, if the Board of Governors finds that the 
     exemption is in the public interest and is consistent with 
     the purpose of this subsection.
       (7) Transition period.--
       (A) In general.--This subsection and any regulations and 
     orders of the Board of Governors under this subsection shall 
     not be effective until 3 years after the date of enactment of 
     this Act.
       (B) Extension authorized.--The Board of Governors may 
     extend the period specified in subparagraph (A) for not 
     longer than an additional 2 years.
       (f) Enhanced Public Disclosures.--The Board of Governors 
     may prescribe, by regulation, periodic public disclosures by 
     nonbank financial companies supervised by the Board of 
     Governors and bank holding companies described in subsection 
     (a) in order to support market evaluation of the risk 
     profile, capital adequacy, and risk management capabilities 
     thereof.
       (g) Risk Committee.--
       (1) Nonbank financial companies supervised by the board of 
     governors.--The Board of Governors shall require each nonbank 
     financial company supervised by the Board of Governors that 
     is a publicly traded company to establish a risk committee, 
     as set forth in paragraph (3), not later than 1 year after 
     the date of receipt of a notice of final determination under 
     section 113(d)(3) with respect to such nonbank financial 
     company supervised by the Board of Governors.
       (2) Certain bank holding companies.--
       (A) Mandatory regulations.--The Board of Governors shall 
     issue regulations requiring each bank holding company that is 
     a publicly traded company and that has total consolidated 
     assets of not less than $10,000,000,000 to establish a risk 
     committee, as set forth in paragraph (3).
       (B) Permissive regulations.--The Board of Governors may 
     require each bank holding company that is a publicly traded 
     company and that has total consolidated assets of less than 
     $10,000,000,000 to establish a risk committee, as set forth 
     in paragraph (3), as determined necessary or appropriate by 
     the Board of Governors to promote sound risk management 
     practices.
       (3) Risk committee.--A risk committee required by this 
     subsection shall--
       (A) be responsible for the oversight of the enterprise-wide 
     risk management practices of the nonbank financial company 
     supervised by the Board of Governors or bank holding company 
     described in subsection (a), as applicable;
       (B) include such number of independent directors as the 
     Board of Governors may determine appropriate, based on the 
     nature of operations, size of assets, and other appropriate 
     criteria related to the nonbank financial company supervised 
     by the Board of Governors or a bank holding company described 
     in subsection (a), as applicable; and
       (C) include at least 1 risk management expert having 
     experience in identifying, assessing, and managing risk 
     exposures of large, complex firms.
       (4) Rulemaking.--The Board of Governors shall issue final 
     rules to carry out this subsection, not later than 1 year 
     after the transfer date, to take effect not later than 15 
     months after the transfer date.
       (h) Stress Tests.--The Board of Governors shall conduct 
     analyses in which nonbank financial companies supervised by 
     the Board of Governors and bank holding companies described 
     in subsection (a) are subject to evaluation of whether the 
     companies have the capital, on a total consolidated basis, 
     necessary to absorb losses as a result of adverse economic 
     conditions. The Board of Governors may develop and apply such 
     other analytic techniques as are necessary to identify, 
     measure, and monitor risks to the financial stability of the 
     United States.

     SEC. 166. EARLY REMEDIATION REQUIREMENTS.

       (a) In General.--The Board of Governors, in consultation 
     with the Council and the Corporation, shall prescribe 
     regulations establishing requirements to provide for the 
     early remediation of financial distress of a nonbank 
     financial company supervised by the Board of Governors or a 
     bank holding company described in section 165(a), except that 
     nothing in this subsection authorizes the provision of 
     financial assistance from the Federal Government.
       (b) Purpose of the Early Remediation Requirements.--The 
     purpose of the early remediation requirements under 
     subsection (a) shall be to establish a series of specific 
     remedial actions to be taken by a nonbank financial company 
     supervised by the Board of Governors or a bank holding 
     company described in section 165(a) that is experiencing 
     increasing financial distress, in order to minimize the 
     probability that the company will become insolvent and the 
     potential harm of such insolvency to the financial stability 
     of the United States.
       (c) Remediation Requirements.--The regulations prescribed 
     by the Board of Governors under subsection (a) shall--
       (1) define measures of the financial condition of the 
     company, including regulatory capital, liquidity measures, 
     and other forward-looking indicators; and
       (2) establish requirements that increase in stringency as 
     the financial condition of the company declines, including--
       (A) requirements in the initial stages of financial 
     decline, including limits on capital distributions, 
     acquisitions, and asset growth; and
       (B) requirements at later stages of financial decline, 
     including a capital restoration plan and capital-raising 
     requirements, limits on transactions with affiliates, 
     management changes, and asset sales.

     SEC. 167. AFFILIATIONS.

       (a) Affiliations.--Nothing in this subtitle shall be 
     construed to require a nonbank financial company supervised 
     by the Board of Governors, or a company that controls a 
     nonbank financial company supervised by the Board of 
     Governors, to conform the activities thereof to the 
     requirements of section 4 of the Bank Holding Company Act of 
     1956 (12 U.S.C. 1843).
       (b) Requirement.--
       (1) In general.--If a nonbank financial company supervised 
     by the Board of Governors conducts activities other than 
     those that are determined to be financial in nature or 
     incidental thereto under section 4(k) of the Bank Holding 
     Company Act of 1956, the Board of Governors may require such 
     company to establish and conduct such activities that are 
     determined to be financial in nature or incidental thereto in 
     an intermediate holding company established pursuant to 
     regulation of the Board of Governors, not later than 90 days 
     after the date on which the nonbank financial company 
     supervised by the Board of Governors was notified of the 
     determination under section 113(a).
       (2) Internal financial activities.--For purposes of this 
     subsection, activities that are determined to be financial in 
     nature or incidental thereto under section 4(k) of the Bank 
     Holding Company Act of 1956, as described in paragraph (1), 
     shall not include internal financial activities conducted for 
     a nonbank financial company supervised by the Board of 
     Governors or any affiliate, including internal treasury, 
     investment, and employee benefit functions. With respect to 
     any internal financial activity of such company during the 
     year prior to the date of enactment of this Act, such company 
     may continue to engage in such activity as long as at least 
     \2/3\ of the assets or \2/3\ of the revenues generated from 
     the activity are from or attributable to such company, 
     subject to review by the Board of Governors, to determine 
     whether engaging in such activity presents undue risk to such 
     company or to the financial stability of the United States.
       (c) Regulations.--The Board of Governors--
       (1) shall promulgate regulations to establish the criteria 
     for determining whether to require a nonbank financial 
     company supervised by the Board of Governors to establish an 
     intermediate holding company under subsection (a); and
       (2) may promulgate regulations to establish any 
     restrictions or limitations on transactions between an 
     intermediate holding company or a nonbank financial company 
     supervised by the Board of Governors and its affiliates, as 
     necessary to prevent unsafe and unsound practices in 
     connection with transactions between such company, or any 
     subsidiary thereof, and its parent company or affiliates that 
     are not subsidiaries of such company, except that such 
     regulations shall not restrict or limit any transaction in 
     connection with the bona fide acquisition or lease by an 
     unaffiliated person of assets, goods, or services.

     SEC. 168. REGULATIONS.

       Except as otherwise specified in this subtitle, not later 
     than 18 months after the transfer date, the Board of 
     Governors shall issue final regulations to implement this 
     subtitle and the amendments made by this subtitle.

     SEC. 169. AVOIDING DUPLICATION.

       The Board of Governors shall take any action that the Board 
     of Governors deems appropriate to avoid imposing requirements 
     under this subtitle that are duplicative of requirements 
     applicable to bank holding companies and nonbank financial 
     companies under other provisions of law.

     SEC. 170. SAFE HARBOR.

       (a) Regulations.--The Board of Governors shall promulgate 
     regulations on behalf of, and in consultation with, the 
     Council setting forth the criteria for exempting certain 
     types or classes of U.S. nonbank financial companies or 
     foreign nonbank financial companies from supervision by the 
     Board of Governors.
       (b) Considerations.--In developing the criteria under 
     subsection (a), the Board of Governors shall take into 
     account the factors for consideration described in 
     subsections (a) and (b) of section 113 in determining whether 
     a U.S. nonbank financial company or foreign nonbank financial 
     company shall be supervised by the Board of Governors.
       (c) Rule of Construction.--Nothing in this section shall be 
     construed to require supervision by the Board of Governors of 
     a U.S. nonbank financial company or foreign nonbank financial 
     company, if such company does not meet the criteria for 
     exemption established under subsection (a).
       (d) Update.--The Board of Governors shall, in consultation 
     with the Council, review the regulations promulgated under 
     subsection (a), not less frequently than every 5 years, and 
     based upon the review, the Board of Governors may revise such 
     regulations on behalf

[[Page S3217]]

     of, and in consultation with, the Council to update as 
     necessary the criteria set forth in such regulations.
       (e) Transition Period.--No revisions under subsection (d) 
     shall take effect before the end of the 2-year period after 
     the date of publication of such revisions in final form.
       (f) Report.--The Chairperson of the Board of Governors and 
     the Chairperson of the Council shall submit a joint report to 
     the Committee on Banking, Housing, and Urban Affairs of the 
     Senate and the Committee on Financial Services of the House 
     of Representatives not later than 30 days after the date of 
     the issuance in final form of the regulations under 
     subsection (a), or any subsequent revision to such 
     regulations under subsection (d), as applicable. Such report 
     shall include, at a minimum, the rationale for exemption and 
     empirical evidence to support the criteria for exemption.
                                 ______
                                 
  SA 3826. Mr. SHELBY (for himself, Mr. McConnell, Mr. Bennett, Mr. 
Crapo, Mr. Corker, Mr. Johanns, Mrs. Hutchison, Mr. Vitter, Mr. 
Bunning, Mr. Chambliss, Mr. Cornyn, Mr. Bond, Mr. Enzi, and Mr. 
Alexander) submitted an amendment intended to be proposed to amendment 
SA 3739 proposed by Mr. Reid (for Mr. Dodd (for himself and Mrs. 
Lincoln)) to the bill S. 3217, to promote the financial stability of 
the United States by improving accountability and transparency in the 
financial system, to end ``too big to fail'', to protect the American 
taxpayer by ending bailouts, to protect consumers from abusive 
financial services practices, and for other purposes; which was ordered 
to lie on the table; as follows:

       Strike title X and insert the following:

          TITLE X--DIVISION FOR CONSUMER FINANCIAL PROTECTION

     SEC. 1001. SHORT TITLE.

       This title may be cited as the ``Consumer Financial 
     Protection Act of 2010''.

     SEC. 1002. DEFINITIONS.

       Except as otherwise provided in this title, for purposes of 
     this title, the following definitions shall apply:
       (1) Covered person.--The term covered person means--
       (A) a depository institution; or
       (B) a person other than a depository institution that is 
     subject to one or more of the enumerated consumer protection 
     statutes.
       (2) Designated transfer date.--The term ``designated 
     transfer date'' means the date established under section 
     1042.
       (3) Division.--The term ``Division'' means the Division for 
     Consumer Financial Protection.
       (4) Enumerated consumer protection statutes.--The term 
     ``enumerated consumer protection statute'' means--
       (A) subsections (c) through (f) of section 43 of the 
     Federal Deposit Insurance Act (12 U.S.C. 1831t);
       (B) the Consumer Leasing Act of 1976 (15 U.S.C. 1667 et 
     seq.);
       (C) the Electronic Fund Transfer Act (15 U.S.C. 1693 et 
     seq.);
       (D) the Equal Credit Opportunity Act (15 U.S.C. 1691 et 
     seq.);
       (E) the Fair Credit Billing Act (15 U.S.C. 1666 et seq.);
       (F) the Fair Credit Reporting Act (15 U.S.C. 1681 et seq.), 
     other than sections 615(e) and 628 of that Act (15 U.S.C. 
     1681m(e), 1681w);
       (G) the Homeowners Protection Act of 1998 (12 U.S.C. 4901, 
     et seq.);
       (H) the Fair Debt Collection Practices Act (15 U.S.C. 1692 
     et seq.);
       (I) sections 502 through 509 of the Gramm-Leach-Bliley Act 
     (15 U.S.C. 6802-6809);
       (J) the Home Mortgage Disclosure Act of 1975 (12 U.S.C. 
     2801 et seq.);
       (K) the Home Ownership and Equity Protection Act of 1994 
     (15 U.S.C. 1601 note);
       (L) the Real Estate Settlement Procedures Act of 1974 (12 
     U.S.C. 2601 et seq.);
       (M) the S.A.F.E. Mortgage Licensing Act of 2008 (12 U.S.C. 
     5101 et seq.);
       (N) the Truth in Lending Act (15 U.S.C. 1601 et seq.);
       (O) the Truth in Savings Act (12 U.S.C. 4301 et seq.); and
       (P) the authority of the Federal Trade Commission, the 
     Board of Governors, the Office of Thrift Supervision, and the 
     National Credit Union Administration to prohibit unfair or 
     deceptive acts or practices under section 18(f) of the 
     Federal Trade Commission Act (15 U.S.C. 57a(f))--
       (i) only to the same extent that the Board of Governors, 
     the Office of Thrift Supervision, the National Credit Union 
     Administration, and the Federal Trade Commission could 
     exercise such authority over covered persons on the day 
     before the designated transfer date; and
       (ii) except that such authority shall not extend to persons 
     or activities covered under the Fair Credit Reporting Act 
     that do not meet the definition in section 603(p) of the Fair 
     Credit Reporting Act (15 U.S.C. 1681a(p)).
       (5) Mortgage loan originator.--The term ``mortgage loan 
     originator'' means any person (other than an individual) that 
     takes applications for residential mortgage transactions and 
     offers or negotiates terms of residential mortgage 
     transactions.
       (6) Nondepository covered person.--The term ``nondepository 
     covered person'' means any entity that--
       (A) is not a depository institution;
       (B) is not an affiliate or subsidiary of a depository 
     institution;
       (C) is not subject to supervision or enforcement by a 
     Federal banking regulator; and
       (D) is a financial services provider subject to the 
     enumerated consumer protection statutes.
       (7) Person.--The term ``person'' has the same meaning as in 
     section 103 of the Truth in Lending Act (15 U.S.C. 1602).
       (8) Prudential regulator.--The term ``prudential 
     regulator'' means the Office of the Comptroller of the 
     Currency, the Federal Deposit Insurance Corporation, or the 
     National Credit Union Administration, as appropriate, with 
     respect to depository institutions and affiliates of 
     depository institutions supervised by such agencies.
       (9) Residential mortgage transaction.--The term 
     ``residential mortgage transaction'' has the same meaning as 
     in section 103 of the Truth in Lending Act (15 U.S.C. 1602).

              Subtitle A--Division of Consumer Protection

     SEC. 1011. ESTABLISHMENT OF THE DIVISION.

       (a) Division Established.--There is established within the 
     Federal Deposit Insurance Corporation the Division for 
     Consumer Protection, which shall regulate, by rule or order, 
     consumer financial products and services under the enumerated 
     consumer protection statutes, and where applicable, as 
     provided for in section 1024, enforce the enumerated consumer 
     protection statutes.
       (b) Director and Deputy Director.--
       (1) Director.--The Division shall be headed by a Director, 
     who shall be appointed by the President, by and with the 
     advice and consent of the Senate, to serve for a term of 4 
     years.
       (2) Deputy director.--The Director shall designate a Deputy 
     Director.
       (3) Acting director.--In the event of a vacancy in the 
     position of the Director or during the absence or disability 
     of the Director, the Deputy Director shall act as Director.
       (4) Compensation.--The Director shall be compensated at a 
     rate prescribed for level II of the Executive Schedule under 
     section 5313 of title 5, United States Code.

     SEC. 1012. ADMINISTRATION.

       (a) Specific Functional Units.--
       (1) Research.--The Director shall establish a unit, the 
     functions of which shall include researching, analyzing, and 
     reporting on--
       (A) developments in markets for consumer financial products 
     or services, including market areas of alternative consumer 
     financial products or services with high growth rates and 
     areas of risk to consumers;
       (B) consumer awareness, understanding, and use of 
     disclosures and communications regarding consumer financial 
     products or services; and
       (C) consumer awareness and understanding of costs, risks, 
     and benefits of consumer financial products or services.
       (2) Collecting and tracking complaints.--
       (A) In general.--The Director shall establish a unit, the 
     functions of which shall include establishing a single, toll-
     free telephone number, a website, and database to facilitate 
     the centralized collection, monitoring, and response to 
     consumer complaints regarding consumer financial products or 
     services. The Director shall coordinate with other Federal 
     agencies to route complaints to other Federal regulators, 
     where appropriate.
       (B) Routing calls to states.--To the extent practicable, 
     State agencies may receive appropriate complaints from the 
     systems established under subparagraph (A), if--
       (i) the State agency system has the functional capacity to 
     receive calls or electronic reports routed by the Division 
     systems; and
       (ii) the State agency has satisfied any conditions of 
     participation in the system that the Division may establish, 
     including treatment of personally identifiable information 
     and sharing of information on complaint resolution or related 
     compliance procedures and resources.
       (C) Reports to congress.--The Director shall present an 
     annual report to Congress, not later than March 31 of each 
     year on the complaints received by the Division in the prior 
     year regarding consumer financial products and services. Such 
     report shall include information and analysis about complaint 
     numbers, types, and, where applicable, information about 
     resolution of complaints.
       (D) Data sharing required.--To facilitate preparation of 
     the reports required under subparagraph (C), supervision and 
     enforcement activities, and monitoring of the market for 
     consumer financial products and services, the Division shall 
     share consumer complaint information with prudential 
     regulators, other Federal agencies, and State agencies, 
     consistent with Federal law applicable to personally 
     identifiable information. The prudential regulators and other 
     Federal agencies shall share data relating to consumer 
     complaints regarding consumer financial products and services 
     with the Division, consistent with Federal law applicable to 
     personally identifiable information.
       (b) Office of Financial Literacy.--
       (1) Establishment.--The Division shall establish an Office 
     of Financial Literacy, which shall be responsible for 
     developing and implementing initiatives intended to educate 
     and empower consumers to make better informed financial 
     decisions. The Director shall serve as the Vice Chairperson 
     on the

[[Page S3218]]

     Financial Literacy and Education Commission established under 
     section 513 of the Financial Literacy and Education 
     Improvement Act (20 U.S.C. 9702).
       (2) Other duties.--The Office of Financial Literacy shall 
     develop and implement a strategy to improve financial 
     literacy, consistent with the National Strategy for Financial 
     Education.
       (3) Coordination.--The Office of Financial Literacy shall 
     coordinate with other units within the Division in carrying 
     out its functions, including working with the research unit 
     established by the Director to conduct research related to 
     consumer financial education and counseling.
       (4) Report.--Not later than 24 months after the designated 
     transfer date, and annually thereafter, the Director shall 
     submit a report on its financial literacy activities and 
     strategy to improve financial literacy of consumers to--
       (A) the Committee on Banking, Housing, and Urban Affairs of 
     the Senate; and
       (B) the Committee on Financial Services of the House of 
     Representatives.

     SEC. 1013. CONSUMER ADVISORY BOARD.

       (a) Establishment Required.--The Director shall establish a 
     Consumer Advisory Board to advise and consult with the 
     Division in the exercise of its functions under this title, 
     the enumerated consumer protection statutes, and to provide 
     information on emerging practices in the consumer financial 
     products or services industry, including regional trends, 
     concerns, and other relevant information.
       (b) Membership.--In appointing the members of the Consumer 
     Advisory Board, the Director shall seek to assemble experts 
     in consumer protection, financial services, and consumer 
     financial products or services and seek representation of the 
     interests of nondepository covered persons and consumers, 
     without regard to party affiliation. Not fewer than 6 members 
     shall be appointed upon the recommendation of the regional 
     Federal Reserve Bank Presidents, on a rotating basis.
       (c) Meetings.--The Consumer Advisory Board shall meet from 
     time to time at the call of the Director, but not less 
     frequently than twice in each year.
       (d) Compensation and Travel Expenses.--Members of the 
     Consumer Advisory Board who are not full-time employees of 
     the United States shall be allowed travel expenses, including 
     transportation and subsistence, while away from their homes 
     or regular places of business.

     SEC. 1014. COORDINATION.

       The Director shall coordinate with other Federal agencies 
     and State regulators, as appropriate, to promote consistent 
     regulatory treatment of consumer financial and investment 
     products and services.

     SEC. 1015. FUNDING.

       (a) Fees and Assessments.--
       (1) In general.--The Chairperson shall establish, by rule, 
     an assessment schedule, including the assessment base and 
     rates, applicable to covered persons subject to section 1023 
     to recover the costs of the Corporation in carrying out its 
     responsibilities described under this title. The Chairperson 
     may, by rule or other action, impose additional assessments 
     on insured depository institutions to regulate consumer 
     financial products and services under the enumerated consumer 
     protection statutes specified in this title.
       (2) Limitation.--The assessments imposed by the Chairperson 
     by rules established pursuant to paragraph (1) shall not 
     exceed the costs reasonably necessary to cover the expenses 
     associated with carrying outs its supervisory and rulemaking 
     responsibilities under this title.
       (b) Fund Established.--
       (1) In general.--There is established in the Treasury of 
     the United States, a separate account, to be known as the 
     Consumer Financial Protection Fund (referred to in this title 
     as the ``CFP Fund''). Fees and assessments collected under 
     subsection (a) shall be deposited into the CFP Fund.
       (2) Rule of construction.--Any amounts deposited into the 
     CFP Fund may not be construed to be Government funds or 
     appropriated monies.
       (3) No apportionment.--Any amounts deposited into the CFP 
     Fund shall not be subject to apportionment for the purpose of 
     chapter 15 of title 31, United States Code, or under any 
     other authority.
       (4) Use of funds.--Funds in the CFP Fund shall be 
     immediately available to the Corporation and under the 
     control of the Corporation, and shall remain available until 
     expended, to pay the expenses of the Corporation in carrying 
     out its duties and responsibilities pursuant to this title.
       (c) Conforming Amendments.--Section 11(a)(4)(A) of the 
     Federal Deposit Insurance Act (12 U.S.C. 1821(a)(4)(A)) is 
     amended--
       (1) in clause (ii), by striking ``and'' at the end;
       (2) by redesignating clause (iii) as clause (iv); and
       (3) by inserting after clause (ii) the following:
       ``(iii) to carry out additional duties pursuant to the 
     Consumer Financial Protection Act of 2010; and''.
       (d) Funding.--The Chairperson shall dedicate not less than 
     10 percent of the annual estimated budget of the Corporation, 
     excluding any funding provided pursuant to section 11(c) of 
     the Federal Deposit Insurance Act (12 U.S.C. 1821(c)), to 
     carry out the requirements specified in this title.

     SEC. 1016. APPEARANCES BEFORE AND REPORTS TO CONGRESS.

       (a) Appearances Before Congress.--The Director shall appear 
     before the Committee on Banking, Housing, and Urban Affairs 
     of the Senate and the Committee on Financial Services of the 
     House of Representatives at semi-annual hearings regarding 
     the reports required under subsection (b).
       (b) Reports Required.--The Director shall, concurrent with 
     each semi-annual hearing referred to in subsection (a), 
     prepare and submit to the President and to the Committee on 
     Banking, Housing, and Urban Affairs of the Senate and the 
     Committee on Financial Services of the House of 
     Representatives, a report, beginning with the session 
     following the designated transfer date.
       (c) Contents.--The reports required by subsection (b) shall 
     include--
       (1) a discussion of the significant problems faced by 
     consumers in shopping for or obtaining consumer financial 
     products or services;
       (2) a justification of the budget request of the previous 
     year;
       (3) a list of the significant rules and orders adopted by 
     the Corporation, as well as other significant initiatives 
     conducted by the Division, during the preceding year and the 
     plan of the Division for rules, orders, or other initiatives 
     to be undertaken during the upcoming period;
       (4) an analysis of complaints about consumer financial 
     products or services that the Division, in consultation with 
     the Federal Trade Commission has received and collected in 
     its central database on complaints during the preceding year;
       (5) a list, with a brief statement of the issues, of the 
     public supervisory and enforcement actions to which the 
     Division was a party during the preceding year; and
       (6) the actions taken regarding rules, orders, and 
     supervisory actions with respect to nondepository covered 
     persons which are not credit unions or depository 
     institutions.

     SEC. 1017. EFFECTIVE DATE.

       This subtitle shall become effective on the date of 
     enactment of this Act.

               Subtitle B--General Powers of the Division

     SEC. 1021. PURPOSE, OBJECTIVES, AND FUNCTIONS.

       (a) Purpose.--The Division shall seek to implement and, 
     where applicable, enforce the enumerated consumer protection 
     statutes consistently for the purpose of ensuring that 
     markets for consumer financial products and services are 
     fair, transparent, and competitive.
       (b) Objectives.--The Division is authorized to exercise its 
     authorities under the enumerated consumer protection statutes 
     for the purposes of ensuring that, with respect to consumer 
     financial products and services--
       (1) consumers are provided with timely and understandable 
     information to make responsible decisions about financial 
     transactions;
       (2) consumers are protected from unfair or deceptive acts 
     and practices;
       (3) outdated, unnecessary, or unduly burdensome regulations 
     are regularly identified and addressed in order to reduce 
     unwarranted regulatory burdens; and
       (4) enumerated consumer protection statutes are enforced 
     consistently, without regard to the status of a person as a 
     depository institution, in order to ensure uniform consumer 
     protection in the marketplace.
       (c) Functions.--The primary functions of the Division are--
       (1) issuing rules, orders and guidance implementing the 
     enumerated consumer protection statutes;
       (2) collecting, investigating, and responding to consumer 
     complaints;
       (3) collecting, researching, and publishing information 
     relevant to the functioning of markets for consumer financial 
     products and services to identify risks to consumers, and the 
     proper functioning of such markets;
       (4) subject to section 1023, supervising nondepository 
     covered persons for compliance with the enumerated consumer 
     protection statutes, and taking appropriate enforcement 
     action to address violations of the enumerated consumer 
     protection statutes;
       (5) conducting financial education programs; and
       (6) performing such support activities as may be necessary 
     or useful to facilitate the other functions of the Division.

     SEC. 1022. RULEMAKING AUTHORITY.

       (a) In General.--The Division is authorized to exercise its 
     authorities under the enumerated consumer protection statutes 
     to implement the provisions of the enumerated consumer 
     protection statutes.
       (b) Rulemaking, Orders, and Guidance.--
       (1) In general.--The Division may prescribe rules and issue 
     orders and guidance, as may be necessary or appropriate to 
     enable the Division to administer and carry out the 
     enumerated consumer protection statutes, and to prevent 
     evasions thereof.
       (2) Exclusive rulemaking authority.--Notwithstanding any 
     other provisions of Federal law, to the extent that a 
     provision of the enumerated consumer protection statutes 
     authorizes the Division and another Federal agency to issue 
     regulations under that provision of law for purposes of 
     assuring compliance with the enumerated consumer protection 
     statutes, the Division shall have the exclusive authority to 
     prescribe rules pursuant to those provisions of law, with 
     respect to compliance with those provisions of law by covered 
     persons.
       (3) Corporation approval required.--No rule or regulation 
     of the Division may become effective with respect to any 
     person,

[[Page S3219]]

     unless approved by majority vote of the members of the Board 
     of Directors of the Corporation.
       (c) Preservation of State Regulation of Insurance.--Nothing 
     in this title shall abrogate or limit in any way section 2 of 
     the Act of March 9, 1945 (15 U.S.C. 1012) or otherwise grant 
     the Division authority over the business of insurance.
       (d) Limitation on Authority of Division.--The Division 
     shall have no authority to issue rules, regulations, orders, 
     or guidance that affect any underwriting standards of 
     depository institutions or affiliates thereof.

     SEC. 1023. SUPERVISION OF NONDEPOSITORY COVERED PERSONS.

       (a) Applicability.--
       (1) Covered persons.--
       (A) Applicability.--
       (i) In general.--Except as provided in paragraph (2), this 
     section shall apply to any person that is--

       (I) a type or category of mortgage loan originator that the 
     Division, in consultation with the Federal Trade Commission, 
     determines by rule is subject to the requirements of this 
     section; or
       (II) a nondepository covered person that demonstrates a 
     pattern or practice of violations of the enumerated consumer 
     protection statutes, that the Division, in consultation with 
     the Federal Trade Commission, determines by order, after 
     notice and opportunity for response, is subject to the 
     requirements of this section.

       (ii) Rule of construction.--On and after the effective date 
     of this section, the Division may consider violations which 
     occurred during the previous 3 years in making a 
     determination that a nondepository covered person shall be 
     subject to this section.
       (B) Factors for consideration.--In determining whether a 
     mortgage loan originator is subject to the requirements of 
     this section, the Division shall consider the risks to 
     consumers created by the provision of such consumer financial 
     products or services and the probability that supervision can 
     serve to diminish such risks. In making these determinations, 
     the Division shall consider--
       (i) the total financial assets of the mortgage loan 
     originator;
       (ii) the volume of transactions involving consumer 
     financial products or service in which the mortgage loan 
     originator engages;
       (iii) the complexity and nature of the financial products 
     or services offered by the mortgage loan originator; and
       (iv) the number and nature of any violations of the 
     enumerated consumer protections statutes by the mortgage loan 
     originator.
       (C) Rule of construction.--Nothing in this section may be 
     construed to prohibit the Division from exempting any class 
     of mortgage loan originator or any specific mortgage loan 
     originator from the requirements of this section.
       (2) Certain persons excluded.--This section shall not apply 
     to persons described in section 1024.
       (b) Supervision.--
       (1) In general.--The Division shall require reports and 
     conduct examinations on a periodic basis of persons described 
     in subsection (a) for purposes of--
       (A) assessing compliance with the requirements of the 
     enumerated consumer protection statutes;
       (B) obtaining information about the activities and 
     compliance systems or procedures of such person; and
       (C) detecting and assessing risks to consumers and to 
     markets for consumer financial products and services.
       (2) Risk-based supervision program.--The Division shall 
     exercise its authority under paragraph (1) in a manner 
     designed to ensure that such exercise, with respect to 
     persons described in subsection (a), is based on the 
     assessment by the Division of the risks posed to consumers, 
     and taking into consideration, as applicable--
       (A) the volume of transactions involving consumer financial 
     products or services in which the persons described in 
     subsection (a) engage;
       (B) the number and nature of any violations of the 
     enumerated consumer protection statutes on the part of the 
     persons described in subsection (a); and
       (C) the extent to which such institutions are subject to 
     oversight by State authorities for consumer protection.
       (3) Coordination.--To minimize regulatory burden, the 
     Division shall coordinate its supervisory activities with the 
     supervisory activities conducted by Federal regulators and 
     the State regulatory authorities, including establishing 
     their respective schedules for examining persons described in 
     subsection (a) and requirements regarding reports to be 
     submitted by such persons.
       (4) Use of existing reports.--The Division shall, to the 
     fullest extent possible, use--
       (A) reports pertaining to persons described in subsection 
     (a) that have been provided to a Federal or State agency; and
       (B) information that has been reported publicly.
       (5) Preservation of authority.--The authority of the 
     Chairperson to require reports from persons described in 
     subsection (a), as permitted under paragraph (1), regarding 
     information under the control of such person, including the 
     authority to require reports when such information is 
     maintained, stored, or processed by another person.
       (6) Reports of tax law noncompliance.--The Division shall 
     provide the Commissioner of Internal Revenue with any report 
     of examination or related information identifying possible 
     tax law noncompliance.
       (7) Registration, recordkeeping and other requirements for 
     certain persons.--
       (A) In general.--The Division shall prescribe rules to 
     facilitate supervision of persons described in subsection (a) 
     and assessment and detection of risks to consumers.
       (B) Registration.--
       (i) In general.--The Division shall prescribe rules 
     regarding registration requirements for persons described in 
     subsection (a).
       (ii) Exception for related persons.--The Division may not 
     impose requirements under this section regarding the 
     registration of a related person.
       (iii) Registration information.--Subject to rules 
     prescribed by the Division, the Division shall publicly 
     disclose the registration information about persons described 
     in subsection (a) to facilitate the ability of consumers to 
     identify persons described in subsection (a) registered with 
     the Division.
       (C) Recordkeeping.--The Division may require a person 
     described in subsection (a), to generate, provide, or retain 
     records for the purposes of facilitating supervision of such 
     persons and assessing and detecting risks to consumers.
       (D) Requirements concerning obligations.--The Division may 
     prescribe rules regarding a person described in subsection 
     (a), to ensure that such persons are legitimate entities and 
     are able to perform their obligations to consumers.
       (E) Consultation with state agencies.--In developing and 
     implementing requirements under this paragraph, the Division 
     shall consult with State regulatory authorities regarding 
     requirements or systems (including coordinated or combined 
     systems for registration), where appropriate.
       (c) Primary Enforcement Authority.--
       (1) The division to have primary enforcement authority.--To 
     the extent that a Federal law authorizes the Division and 
     another Federal agency, other than the Federal Trade 
     Commission, to enforce an enumerated consumer protection 
     statute, the Division shall have exclusive authority to 
     enforce that enumerated consumer protection statute with 
     respect to any person described in subsection (a)(1)(A).
       (2) Referral.--Any Federal agency authorized to enforce an 
     enumerated consumer protection statute may recommend in 
     writing to the Division that the Division initiate an 
     enforcement proceeding, as the Division is authorized by that 
     statute or by this title.
       (3) Coordination with the federal trade commission.--
       (A) In general.--The Division and the Federal Trade 
     Commission shall coordinate enforcement actions for 
     violations of Federal law regarding the offering or provision 
     of consumer financial products or services by any person 
     described in subsection (a)(1)(A), or service providers 
     thereto. In carrying out this subparagraph, the agencies 
     shall negotiate an agreement to establish procedures for such 
     coordination, including procedures for notice to the other 
     agency, where feasible, prior to initiating a civil action to 
     enforce a Federal law regarding the offering or provision of 
     consumer financial products or services.
       (B) Civil actions.--Whenever a civil action has been filed 
     by, or on behalf of, the Division or the Federal Trade 
     Commission for any violation of any provision of Federal law 
     described in subparagraph (A), or any regulation prescribed 
     under such provision of law--
       (i) the other agency may not, during the pendency of that 
     action, institute a civil action under such provision of law 
     against any defendant named in the complaint in such pending 
     action for any violation alleged in the complaint; and
       (ii) the Division or the Federal Trade Commission may 
     intervene as a party in any such action brought by the other 
     agency, and, upon intervening--

       (I) be heard on all matters arising in such enforcement 
     action; and
       (II) file petitions for appeal in such actions.

       (C) Agreement terms.--The terms of any agreement negotiated 
     under subparagraph (A) may modify or supersede the provisions 
     of subparagraph (B).
       (D) Deadline.--The agencies shall reach the agreement 
     required under subparagraph (A) not later than 6 months after 
     the designated transfer date.
       (4) Savings provision.--Except as specifically stated in 
     this title regarding the enumerated consumer protection 
     statutes, nothing in this title shall be construed as 
     modifying, limiting, or otherwise affecting the authority of 
     the Federal Trade Commission under the Federal Trade 
     Commission Act, or any other provision of law.
       (d) Exclusive Rulemaking and Examination Authority.--To the 
     extent that Federal law authorizes the Division and another 
     Federal agency to issue regulations or guidance, conduct 
     examinations, or require reports from a person described in 
     subsection (a) under that provision of law for purposes of 
     assuring compliance with the enumerated consumer protection 
     statutes and any regulations thereunder, the Division shall 
     have the exclusive authority to prescribe rules, issue 
     guidance, conduct examinations, require reports, or issue 
     exemptions with regard to a person described in subsection 
     (a), subject to those provisions of law.
       (e) Service Providers.--A service provider to a person 
     described in subsection (a) shall be subject to the authority 
     of the Division under this section, to the same extent as if

[[Page S3220]]

     such service provider were engaged in a service relationship 
     with a bank, and the Division were an appropriate Federal 
     banking agency under section 7(c) of the Bank Service Company 
     Act (12 U.S.C. 1867(c)). For purposes of this subsection, a 
     service provider shall not include persons described in 
     section 1024.
       (f) Enforcement Authority.--The Division may enforce the 
     requirements of this title with respect to persons described 
     in subsection (a) pursuant to section 8 of the Federal 
     Deposit Insurance Act (12 U.S.C. 1818), as if such person 
     were an insured depository institution.

     SEC. 1024. SUPERVISION AND ENFORCEMENT ON CONSUMER 
                   PROTECTION.

       The Division shall have no authority to require reports 
     from, conduct examinations of, or take enforcement action 
     against an insured depository institution or any affiliate 
     thereof. The authorities of the Division and the Director 
     under this title do not alter or affect the authority of the 
     prudential regulators to require reports from, conduct 
     examinations of, or take enforcement action against an 
     insured depository institution or any affiliate thereof for 
     purposes of assessing and enforcing compliance by such person 
     with the requirements of the enumerated consumer protection 
     statutes and obtaining information about the activities 
     subject to such law and the associated compliance systems or 
     procedures of such institution or affiliate.

     SEC. 1025. DISCLOSURES.

       (a) In General.--To the extent that the enumerated consumer 
     protection statutes require disclosures to consumers, the 
     Division shall prescribe rules to ensure that such 
     disclosures make timely, appropriate, and effective 
     disclosures to consumers of the costs, benefits, and risks 
     associated with the product or service.
       (b) Model Disclosures.--
       (1) In general.--Any final rule prescribed by the Division 
     under this section requiring disclosures may include a model 
     form that may be used.
       (2) Format.--A model form issued pursuant to paragraph (1) 
     shall contain a clear and conspicuous disclosure that, at a 
     minimum--
       (A) uses plain language comprehensible to consumers;
       (B) contains a clear format and design, such as an easily 
     readable type font; and
       (C) succinctly explains the information that must be 
     communicated to the consumer.
       (3) Consumer testing.--Any model form issued by the 
     Division shall be validated through consumer testing.
       (c) Basis for Rulemaking.--In prescribing disclosure rules, 
     the Division shall consider available evidence about consumer 
     awareness, understanding of, and responses to disclosures or 
     communications about the risks, costs, and benefits of 
     consumer financial products or services.
       (d) Safe Harbor.--Any person that uses a model form issued 
     by the Division shall be deemed to be in compliance with the 
     disclosure requirements of this section with respect to such 
     model form.
       (e) Trial Disclosure Programs.--
       (1) In general.--The Division may permit a person to 
     conduct a trial program that is limited in time and scope, 
     subject to specified standards and procedures, for the 
     purpose of providing trial disclosures to consumers that are 
     designed to improve upon any model form issued by the 
     Division.
       (2) Safe harbor.--The standards and procedures issued by 
     the Division shall be designed to encourage persons to 
     conduct trial disclosure programs. For the purposes of 
     administering this subsection, the Division may establish a 
     limited period during which a person conducting a trial 
     disclosure program shall be deemed to be in compliance with, 
     or may be exempted from, a requirement of a rule or an 
     enumerated consumer protection statute.
       (3) Public disclosure.--The rules of the Division shall 
     provide for public disclosure of trial disclosure programs, 
     which public disclosure may be limited, to the extent 
     necessary to encourage nondepository covered persons to 
     conduct effective trials.

     Subtitle C--Transfer of Functions and Personnel; Transitional 
                               Provisions

     SEC. 1041. TRANSFER OF CONSUMER FINANCIAL PROTECTION 
                   FUNCTIONS.

       (a) Defined Terms.--For purposes of this subtitle--
       (1) the term ``consumer financial protection functions'' 
     means--
       (A) the functions and authorities of the Board of Governors 
     under the enumerated consumer protection statutes, except 
     those functions retained by the prudential regulators under 
     section 1024; and
       (B) the functions and authorities of the Federal Trade 
     Commission under the enumerated consumer laws with respect to 
     persons subject to the jurisdiction of the Division under 
     section 1023, except that the Federal Trade Commission shall 
     retain concurrent enforcement jurisdiction under the 
     enumerated consumer protection statutes over such persons, 
     consistent with subsection 1023(c); and
       (2) the terms ``transferor agency'' and ``transferor 
     agencies'' mean, respectively the Board of Governors and the 
     Federal Trade Commission.
       (b) In General.--Except as provided in subsection (c), 
     consumer financial protection functions are transferred as 
     follows:
       (1) Board of governors.--
       (A) Transfer of functions.--All consumer financial 
     protection functions of the Board of Governors are 
     transferred to the Division.
       (B) Board of governors authority.--The Division shall have 
     all powers and duties that were vested in the Board of 
     Governors, relating to consumer financial protection 
     functions, on the day before the designated transfer date.
       (2) Federal trade commission.--
       (A) Transfer of functions.--All consumer financial 
     protection functions of the Federal Trade Commission are 
     transferred to the Division. Nothing in this title shall be 
     construed to require a mandatory transfer of any employee of 
     the Federal Trade Commission to the Division.
       (B) Commission authority.--The Division shall have all 
     powers and duties that were vested in the Federal Trade 
     Commission relating to consumer financial protection 
     functions on the day before the designated transfer date.
       (c) Transfers of Functions Subject to Examination and 
     Enforcement Authority Remaining With Transferor Agencies.--
     The transfers of functions in subsection (b) do not affect 
     the authority of the prudential regulators from conducting 
     examinations or initiating and maintaining enforcement 
     proceedings in accordance with section 1023.
       (d) Effective Date.--Subsections (b) and (c) shall become 
     effective on the designated transfer date.

     SEC. 1042. DESIGNATED TRANSFER DATE.

       (a) In General.--Not later than 60 days after the date of 
     enactment of this Act, the Secretary shall--
       (1) in consultation with the Chairman of the Board of 
     Governors, the Chairperson of the Corporation, the Chairman 
     of the Federal Trade Commission, the Chairman of the National 
     Credit Union Administration Board, the Comptroller of the 
     Currency, the Director of the Office of Thrift Supervision, 
     the Secretary of the Department of Housing and Urban 
     Development, and the Director of the Office of Management and 
     Budget, designate a single calendar date for the transfer of 
     functions to the Division under section 1041; and
       (2) publish notice of that designated date in the Federal 
     Register.
       (b) Changing Designation.--The Secretary--
       (1) may, in consultation with the Chairman of the Board of 
     Governors, the Chairperson of the Federal Deposit Insurance 
     Corporation, the Chairman of the Federal Trade Commission, 
     the Chairman of the National Credit Union Administration 
     Board, the Comptroller of the Currency, the Director of the 
     Office of Thrift Supervision, the Secretary of the Department 
     of Housing and Urban Development, and the Director of the 
     Office of Management and Budget, change the date designated 
     under subsection (a); and
       (2) shall publish notice of any changed designated date in 
     the Federal Register.
       (c) Permissible Dates.--
       (1) In general.--Except as provided in paragraph (2), any 
     date designated under this section shall be not earlier than 
     180 days, nor later than 18 months, after the date of 
     enactment of this Act.
       (2) Extension of time.--The Secretary may designate a date 
     that is later than 18 months after the date of enactment of 
     this Act if the Secretary transmits to appropriate committees 
     of Congress--
       (A) a written determination that orderly implementation of 
     this title is not feasible before the date that is 18 months 
     after the date of enactment of this Act;
       (B) an explanation of why an extension is necessary for the 
     orderly implementation of this title; and
       (C) a description of the steps that will be taken to effect 
     an orderly and timely implementation of this title within the 
     extended time period.
       (3) Extension limited.--In no case may any date designated 
     under this section be later than 24 months after the date of 
     enactment of this Act.

     SEC. 1043. SAVINGS PROVISIONS.

       (a) Board of Governors.--
       (1) Existing rights, duties, and obligations not 
     affected.--Section 1041(b)(1) does not affect the validity of 
     any right, duty, or obligation of the United States, the 
     Board of Governors (or any Federal reserve bank), or any 
     other person that--
       (A) arises under any provision of law relating to any 
     consumer financial protection function of the Board of 
     Governors transferred to the Division by this title; and
       (B) existed on the day before the designated transfer date.
       (2) Continuation of suits.--No provision of this title 
     shall abate any proceeding commenced by or against the Board 
     of Governors (or any Federal reserve bank) before the 
     designated transfer date with respect to any consumer 
     financial protection function of the Board of Governors (or 
     any Federal reserve bank) transferred to the Division by this 
     title, except that the Division, subject to section 1023, 
     shall be substituted for the Board of Governors (or Federal 
     reserve bank) as a party to any such proceeding as of the 
     designated transfer date.
       (b) Federal Trade Commission.--
       (1) Existing rights, duties, and obligations not 
     affected.--Section 1041(b)(5) does not affect the validity of 
     any right, duty, or obligation of the United States, the 
     Federal Trade Commission, or any other person, that--
       (A) arises under any provision of law relating to any 
     consumer financial protection

[[Page S3221]]

     function of the Federal Trade Commission transferred to the 
     Division by this title; and
       (B) existed on the day before the designated transfer date.
       (2) Continuation of suits.--No provision of this title 
     shall abate any proceeding commenced by or against the 
     Federal Trade Commission before the designated transfer date 
     with respect to any consumer financial protection function of 
     the Federal Trade Commission transferred to the Division by 
     this title, except that the Division, subject to section 
     1023, shall be substituted for the Federal Trade Commission 
     as a party to any such proceeding as of the designated 
     transfer date.
       (c) Continuation of Existing Orders, Rules, Determinations, 
     Agreements, and Resolutions.--All orders, resolutions, 
     determinations, agreements, and rules that have been issued, 
     made, prescribed, or allowed to become effective by any 
     transferor agency or by a court of competent jurisdiction, in 
     the performance of consumer financial protection functions 
     that are transferred by this title and that are in effect on 
     the day before the designated transfer date, shall continue 
     in effect according to the terms of those orders, 
     resolutions, determinations, agreements, and rules, and shall 
     not be enforceable by or against the Division.
       (d) Identification of Rules Continued.--Not later than the 
     designated transfer date, the Division--
       (1) shall, after consultation with the head of each 
     transferor agency, identify the rules continued under 
     subsection (g) that will be enforced by the Division; and
       (2) shall publish a list of such rules in the Federal 
     Register.
       (e) Status of Rules Proposed or Not Yet Effective.--
       (1) Proposed rules.--Any proposed rule of a transferor 
     agency which that agency, in performing consumer financial 
     protection functions transferred by this title, has proposed 
     before the designated transfer date, but has not been 
     published as a final rule before that date, shall be deemed 
     to be a proposed rule of the Division.
       (2) Rules not yet effective.--Any interim or final rule of 
     a transferor agency which that agency, in performing consumer 
     financial protection functions transferred by this title, has 
     published before the designated transfer date, but which has 
     not become effective before that date, shall become effective 
     as a rule of the Division according to its terms.

     SEC. 1044. TRANSFER OF CERTAIN PERSONNEL.

       (a) In General.--
       (1) Certain federal reserve system employees transferred.--
       (A) Identifying employees for transfer.--The Division and 
     the Board of Governors shall--
       (i) jointly determine the number of employees of the Board 
     of Governors necessary to perform or support the consumer 
     financial protection functions of the Board of Governors that 
     are transferred to the Division by this title; and
       (ii) consistent with the number determined under clause 
     (i), jointly identify employees of the Board of Governors for 
     transfer to the Division, in a manner that the Division and 
     the Board of Governors, in their sole discretion, determine 
     equitable.
       (B) Identified employees transferred.--All employees of the 
     Board of Governors identified under subparagraph (A)(ii) 
     shall be transferred to the Division for employment.
       (C) Federal reserve bank employees.--Employees of any 
     Federal reserve bank who, on the day before the designated 
     transfer date, are performing consumer financial protection 
     functions on behalf of the Board of Governors shall be 
     treated as employees of the Board of Governors for purposes 
     of subparagraphs (A) and (B).
       (2) Appointment authority for excepted service and senior 
     executive service transferred.--
       (A) In general.--In the case of employee occupying a 
     position in the excepted service or the Senior Executive 
     Service, any appointment authority established pursuant to 
     law or regulations of the Office of Personnel Management for 
     filling such positions shall be transferred, subject to 
     subparagraph (B).
       (B) Declining transfers allowed.--An agency or entity may 
     decline to make a transfer of authority under subparagraph 
     (A) (and the employees appointed pursuant thereto) to the 
     extent that such authority relates to positions excepted from 
     the competitive service because of their confidential, 
     policy-making, policy-determining, or policy-advocating 
     character, and non-career positions in the Senior Executive 
     Service (within the meaning of section 3132(a)(7) of title 5, 
     United States Code).
       (b) Timing of Transfers and Position Assignments.--Each 
     employee to be transferred under this section shall--
       (1) be transferred not later than 90 days after the 
     designated transfer date; and
       (2) receive notice of a position assignment not later than 
     120 days after the effective date of his or her transfer.
       (c) Transfer of Function.--
       (1) In general.--Notwithstanding any other provision of 
     law, the transfer of employees shall be deemed a transfer of 
     functions for the purpose of section 3503 of title 5, United 
     States Code.
       (2) Priority of this title.--If any provisions of this 
     title conflict with any protection provided to transferred 
     employees under section 3503 of title 5, United States Code, 
     the provisions of this title shall control.
       (d) Equal Status and Tenure Positions.--
       (1) Employees transferred from board, ftc.--Each employee 
     transferred under this title from the Board of Governors or 
     the Federal Trade Commission shall be placed in a position at 
     the Division with the same status and tenure as that employee 
     held on the day before the designated transfer date.
       (2) Employees transferred from the federal reserve banks.--
       (A) Comparability.--Each employee transferred under this 
     title from a Federal reserve bank shall be placed in a 
     position with the same status and tenure as that of an 
     employee transferring to the Division from the Board of 
     Governors who perform similar functions and have similar 
     periods of service.
       (B) Service periods credited.--For purposes of this 
     paragraph, periods of service with the Board of Governors or 
     a Federal reserve bank shall be credited as periods of 
     service with a Federal agency.
       (e) Additional Certification Requirements Limited.--
     Examiners transferred to the Division are not subject to any 
     additional certification requirements before being placed in 
     a comparable examiner position at the Division examining the 
     same types of institutions as they examined before they were 
     transferred.
       (f) Personnel Actions Limited.--
       (1) 2-Year protection.--Except as provided in paragraph 
     (2), each transferred employee holding a permanent position 
     on the day before the designated transfer date may not, 
     during the 2-year period beginning on the designated transfer 
     date, be involuntarily separated, or involuntarily reassigned 
     outside his or her locality pay area, as defined by the 
     Office of Personnel Management.
       (2) Exceptions.--Paragraph (1) does not limit the right of 
     the Division--
       (A) to separate an employee for cause or for unacceptable 
     performance;
       (B) to terminate an appointment to a position excepted from 
     the competitive service because of its confidential policy-
     making, policy-determining, or policy-advocating character; 
     or
       (C) to reassign a supervisory employee outside his or her 
     locality pay area, as defined by the Office of Personnel 
     Management, when the Division determines that the 
     reassignment is necessary for the efficient operation of the 
     Division.
       (g) Pay.--
       (1) 2-Year protection.--Except as provided in paragraph 
     (2), each transferred employee shall, during the 2-year 
     period beginning on the designated transfer date, receive pay 
     at a rate equal to not less than the basic rate of pay 
     (including any geographic differential) that the employee 
     received during the pay period immediately preceding the date 
     of transfer.
       (2) Exceptions.--Paragraph (1) does not limit the right of 
     the Division to reduce the rate of basic pay of a transferred 
     employee--
       (A) for cause;
       (B) for unacceptable performance; or
       (C) with the consent of the employee.
       (3) Protection only while employed.--Paragraph (1) applies 
     to a transferred employee only while that employee remains 
     employed by the Division.
       (4) Pay increases permitted.--Paragraph (1) does not limit 
     the authority of the Division to increase the pay of a 
     transferred employee.
       (h) Reorganization.--
       (1) Between 1st and 3rd year.--
       (A) In general.--If the Division determines, during the 2-
     year period beginning 1 year after the designated transfer 
     date, that a reorganization of the staff of the Division is 
     required--
       (i) that reorganization shall be deemed a ``major 
     reorganization'' for purposes of affording affected employees 
     retirement under section 8336(d)(2) or 8414(b)(1)(B) of title 
     5, United States Code;
       (ii) before the reorganization occurs, all employees in the 
     same locality pay area as defined by the Office of Personnel 
     Management shall be placed in a uniform position 
     classification system; and
       (iii) any resulting reduction in force shall be governed by 
     the provisions of chapter 35 of title 5, United States Code, 
     except that the Division shall--

       (I) establish competitive areas (as that term is defined in 
     regulations issued by the Office of Personnel Management) to 
     include at a minimum all employees in the same locality pay 
     area as defined by the Office of Personnel Management;
       (II) establish competitive levels (as that term is defined 
     in regulations issued by the Office of Personnel Management) 
     without regard to whether the particular employees have been 
     appointed to positions in the competitive service or the 
     excepted service; and
       (III) afford employees appointed to positions in the 
     excepted service (other than to a position excepted from the 
     competitive service because of its confidential policy-
     making, policy-determining, or policy-advocating character) 
     the same assignment rights to positions within the Division 
     as employees appointed to positions in the competitive 
     service.

       (B) Service credit for reductions in force.--For purposes 
     of this paragraph, periods of service with a Federal home 
     loan bank, a joint office of the Federal home loan banks, the 
     Board of Governors, a Federal reserve bank, the Federal 
     Deposit Insurance Corporation, or the National Credit Union 
     Administration shall be credited as periods of service with a 
     Federal agency.
       (2) After 3rd year.--

[[Page S3222]]

       (A) In general.--If the Division determines, at any time 
     after the 3-year period beginning on the designated transfer 
     date, that a reorganization of the staff of the Division is 
     required, any resulting reduction in force shall be governed 
     by the provisions of chapter 35 of title 5, United States 
     Code, except that the Division shall establish competitive 
     levels (as that term is defined in regulations issued by the 
     Office of Personnel Management) without regard to types of 
     appointment held by particular employees transferred under 
     this section.
       (B) Service credit for reductions in force.--For purposes 
     of this paragraph, periods of service with a Federal home 
     loan bank, a joint office of the Federal home loan banks, the 
     Board of Governors, a Federal reserve bank, the Federal 
     Deposit Insurance Corporation, or the National Credit Union 
     Administration shall be credited as periods of service with a 
     Federal agency.
       (i) Benefits.--
       (1) Retirement benefits for transferred employees.--
       (A) In general.--
       (i) Continuation of existing retirement plan.--Except as 
     provided in subparagraph (B), each transferred employee shall 
     remain enrolled in his or her existing retirement plan, 
     through any period of continuous employment with the 
     Division.
       (ii) Employer contribution.--The Division shall pay any 
     employer contributions to the existing retirement plan of 
     each transferred employee, as required under that plan.
       (B) Option for employees transferred from federal reserve 
     system to be subject to federal employee retirement 
     program.--
       (i) Election.--Any transferred employee who was enrolled in 
     a Federal Reserve System retirement plan on the day before 
     his or her transfer to the Division may, during the 1-year 
     period beginning 6 months after the designated transfer date, 
     elect to be subject to the Federal employee retirement 
     program.
       (ii) Effective date of coverage.--For any employee making 
     an election under clause (i), coverage by the Federal 
     employee retirement program shall begin 1 year after the 
     designated transfer date.
       (C) Division participation in federal reserve system 
     retirement plan.--
       (i) Separate account in federal reserve system retirement 
     plan established.--Notwithstanding any other provision of 
     law, and subject to the terms and conditions of this section, 
     a separate account in the Federal Reserve System retirement 
     plan shall be established for Division employees who do not 
     make the election under subparagraph (B).
       (ii) Funds attributable to transferred employees remaining 
     in federal reserve system retirement plan transferred.--The 
     proportionate share of funds in the Federal Reserve System 
     retirement plan, including the proportionate share of any 
     funding surplus in that plan, attributable to a transferred 
     employee who does not make the election under subparagraph 
     (B), shall be transferred to the account established under 
     clause (i).
       (iii) Employer contributions deposited.--The Division shall 
     deposit into the account established under clause (i) the 
     employer contributions that the Division makes on behalf of 
     employees who do not make the election under subparagraph 
     (B).
       (iv) Account administration.--The Division shall administer 
     the account established under clause (i) as a participating 
     employer in the Federal Reserve System retirement plan.
       (D) Definitions.--For purposes of this paragraph--
       (i) the term ``existing retirement plan'' means, with 
     respect to any employee transferred under this section, the 
     particular retirement plan (including the Financial 
     Institutions Retirement Fund) and any associated thrift 
     savings plan of the agency or Federal reserve bank from which 
     the employee was transferred, which the employee was enrolled 
     in on the day before the designated transfer date; and
       (ii) the term ``Federal employee retirement program'' means 
     the retirement program for Federal employees established by 
     chapter 84 of title 5, United States Code.
       (2) Benefits other than retirement benefits for transferred 
     employees.--
       (A) During 1st year.--
       (i) Existing plans continue.--Each transferred employee 
     may, for 1 year after the designated transfer date, retain 
     membership in any other employee benefit program of the 
     agency or bank from which the employee transferred, including 
     a dental, vision, long term care, or life insurance program, 
     to which the employee belonged on the day before the 
     designated transfer date.
       (ii) Employer contribution.--The Division shall reimburse 
     the agency or bank from which an employee was transferred for 
     any cost incurred by that agency or bank in continuing to 
     extend coverage in the benefit program to the employee, as 
     required under that program or negotiated agreements.
       (B) Dental, vision, or life insurance after 1st year.--If, 
     after the 1-year period beginning on the designated transfer 
     date, the Division decides not to continue participation in 
     any dental, vision, or life insurance program of an agency or 
     bank from which an employee transferred, a transferred 
     employee who is a member of such a program may, before the 
     decision of the Division takes effect, elect to enroll, 
     without regard to any regularly scheduled open season, in--
       (i) the enhanced dental benefits established by chapter 89A 
     of title 5, United States Code;
       (ii) the enhanced vision benefits established by chapter 
     89B of title 5, United States Code; or
       (iii) the Federal Employees Group Life Insurance Program 
     established by chapter 87 of title 5, United States Code, 
     without regard to any requirement of insurability.
       (C) Long term care insurance after 1st year.--If, after the 
     1-year period beginning on the designated transfer date, the 
     Division decides not to continue participation in any long 
     term care insurance program of an agency or bank from which 
     an employee transferred, a transferred employee who is a 
     member of such a program may, before the decision of the 
     Division takes effect, elect to apply for coverage under the 
     Federal Long Term Care Insurance Program established by 
     chapter 90 of title 5, United States Code, under the 
     underwriting requirements applicable to a new active 
     workforce member (as defined in part 875, title 5, Code of 
     Federal Regulations).
       (D) Employee contribution.--An individual enrolled in the 
     Federal Employees Health Benefits program shall pay any 
     employee contribution required by the plan.
       (E) Additional funding.--The Division shall transfer to the 
     Federal Employees Health Benefits Fund established under 
     section 8909 of title 5, United States Code, an amount 
     determined by the Director of the Office of Personnel 
     Management, after consultation with the Division and the 
     Office of Management and Budget, to be necessary to reimburse 
     the Fund for the cost to the Fund of providing benefits under 
     this paragraph.
       (F) Credit for time enrolled in other plans.--For employees 
     transferred under this title, enrollment in a health benefits 
     plan administered by a transferor agency or a Federal reserve 
     bank, as the case may be, immediately before enrollment in a 
     health benefits plan under chapter 89 of title 5, United 
     States Code, shall be considered as enrollment in a health 
     benefits plan under that chapter for purposes of section 
     8905(b)(1)(A) of title 5, United States Code.
       (G) Special provisions to ensure continuation of life 
     insurance benefits.--
       (i) In general.--An annuitant (as defined in section 
     8901(3) of title 5, United States Code) who is enrolled in a 
     life insurance plan administered by a transferor agency on 
     the day before the designated transfer date shall be eligible 
     for coverage by a life insurance plan under sections 8706(b), 
     8714a, 8714b, and 8714c of title 5, United States Code, or in 
     a life insurance plan established by the Division, without 
     regard to any regularly scheduled open season and requirement 
     of insurability.
       (ii) Employee contribution.--An individual enrolled in a 
     life insurance plan under this subparagraph shall pay any 
     employee contribution required by the plan.
       (iii) Additional funding.--The Division shall transfer to 
     the Employees' Life Insurance Fund established under section 
     8714 of title 5, United States Code, an amount determined by 
     the Director of the Office of Personnel Management, after 
     consultation with the Division and the Office of Management 
     and Budget, to be necessary to reimburse the Fund for the 
     cost to the Fund of providing benefits under this 
     subparagraph not otherwise paid for by the employee under 
     clause (ii).
       (iv) Credit for time enrolled in other plans.--For 
     employees transferred under this title, enrollment in a life 
     insurance plan administered by a transferor agency 
     immediately before enrollment in a life insurance plan under 
     chapter 87 of title 5, United States Code, shall be 
     considered as enrollment in a life insurance plan under that 
     chapter for purposes of section 8706(b)(1)(A) of title 5, 
     United States Code.
       (3) OPM rules.--The Office of Personnel Management shall 
     issue such rules as are necessary to carry out this 
     subsection.
       (j) Implementation of Uniform Pay and Classification 
     System.--Not later than 2 years after the designated transfer 
     date, the Division shall implement a uniform pay and 
     classification system for all employees transferred under 
     this title.
       (k) Equitable Treatment.--In administering the provisions 
     of this section, the Division--
       (1) shall take no action that would unfairly disadvantage 
     transferred employees relative to each other based on their 
     prior employment by the Board of Governors, the Federal 
     Deposit Insurance Corporation, the Federal Trade Commission, 
     the National Credit Union Administration, the Office of the 
     Comptroller of the Currency, the Office of Thrift 
     Supervision, a Federal reserve bank, a Federal home loan 
     bank, or a joint office of the Federal home loan banks; and
       (2) may take such action as is appropriate in individual 
     cases so that employees transferred under this section 
     receive equitable treatment, with respect to the status, 
     tenure, pay, benefits (other than benefits under programs 
     administered by the Office of Personnel Management), and 
     accrued leave or vacation time of those employees, for prior 
     periods of service with any Federal agency, including the 
     Board of Governors, the Corporation, the Federal Trade 
     Commission, the National Credit Union Administration, the 
     Office of the Comptroller of the Currency, the Office of 
     Thrift Supervision, a Federal reserve bank, a Federal home 
     loan bank, or a joint office of the Federal home loan banks.
       (l) Implementation.--In implementing the provisions of this 
     section, the Division shall

[[Page S3223]]

     coordinate with the Office of Personnel Management and other 
     entities having expertise in matters related to employment to 
     ensure a fair and orderly transition for affected employees.

       Subtitle D--Amendment to the Federal Deposit Insurance Act

     SEC. 1051. CORPORATION BOARD MEMBERSHIP.

       Section 2(a)(1)(B) of the Federal Deposit Insurance Act (12 
     U.S.C. 1812(a)(1)(B)) is amended to read as follows:
       ``(B) the Head of Supervision for the Board of Governors of 
     the Federal Reserve System; and''.
                                 ______
                                 
  SA 3827. Mr. SHELBY (for himself and Mr. Dodd) submitted an amendment 
intended to be proposed to amendment SA 3739 proposed by Mr. Reid (for 
Mr. Dodd (for himself and Mrs. Lincoln)) to the bill S. 3217, to 
promote the financial stability of the United States by improving 
accountability and transparency in the financial system, to end ``too 
big to fail'', to protect the American taxpayer by ending bailouts, to 
protect consumers from abusive financial services practices, and for 
other purposes; as follows:

       On page 111, line 7, insert ``(a) In General.--'' before 
     ``In''.
       On page 114, line 14, after ``(iii)'' insert ``that is 
     predominantly engaged in activities that the Board of 
     Governors has determined are financial in nature or 
     incidental thereto for purposes of section 4(k) of the Bank 
     Holding Company Act of 1956 (12 U.S.C. 1843(k))''.
       On page 114, line 21, after ``(12 U.S.C. 2001 et seq.)'' 
     insert ``, a governmental entity, or a regulated entity, as 
     defined under section 1303 of the Federal Housing Enterprises 
     Financial Safety and Soundness Act of 1992 (12 U.S.C. 
     4502(20))''.
       On page 115, strike lines 18 through 20, and insert the 
     following:
       (15) Court.--The term ``Court'' means the United States 
     District Court for the District of Columbia.
       On page 115, between lines 22 and 23, insert the following:
       (b) Definitional Criteria.--For purpose of the definition 
     of the term ``financial company'' under subsection (a)(10), 
     no company shall be deemed to be predominantly engaged in 
     activities that the Board of Governors has determined are 
     financial in nature or incidental thereto for purposes of 
     section 4(k) of the Bank Holding Company Act of 1956 (12 
     U.S.C. 1843(k)), if the consolidated revenues of such company 
     from such activities constitute less than 85 percent of the 
     total consolidated revenues of such company, as the 
     Corporation, in consultation with the Secretary, shall 
     establish by regulation. In determining whether a company is 
     a financial company under this title, the consolidated 
     revenues derived from the ownership or control of a 
     depository institution shall be included.
       On page 115, line 23, strike ``ORDERLY LIQUIDATION 
     AUTHORITY PANEL'' and insert ``JUDICIAL REVIEW''.
       On page 115, strike line 24 and all that follows through 
     page 116, line 16.
       On page 116, line 17, strike ``(b)'' and insert ``(a)''.
       On page 116, strike lines 18 through 20, and insert the 
     following:
       (1) Petition to district court.--
       (A) District court review.--
       On page 116, strike line 21 and all that follows through 
     page 117, line 4, and insert the following:
       (i) Petition to district court.--Subsequent to a 
     determination by the Secretary under section 203 that a 
     financial company satisfies the criteria in section 203(b), 
     the Secretary shall notify the Corporation and the covered 
     financial company. If the board of directors (or body 
     performing similar functions) of the covered financial 
     company acquiesces or consents to the appointment of the 
     Corporation as a receiver, the Secretary shall appoint the 
     Corporation as a receiver. If the board of directors (or body 
     performing similar functions) of the covered financial 
     company does not acquiesce or consent to the appointment of 
     the Corporation as receiver, the Secretary shall petition the 
     United States District Court for the District of Columbia for 
     an order authorizing the Secretary to appoint the Corporation 
     as a receiver.
       On page 117, line 9, strike ``Panel'' and insert ``Court''.
       On page 117, line 13, strike ``Panel'' and insert 
     ``Court''.
       On page 117, beginning on line 16, strike ``, within 24 
     hours of receipt of the petition filed by the Secretary,''.
       On page 117, line 21, strike ``is supported'' and all that 
     follows through line 22, and insert ``and satisfies the 
     definition of a financial company under section 201(10) is 
     arbitrary and capricious.''.
       On page 117, line 24, strike ``Panel'' and insert 
     ``Court''.
       On page 118, line 2, insert ``and satisfies the definition 
     of a financial company under section 201(10)'' after ``danger 
     of default''.
       On page 118, lines 3 and 4, strike ``is supported by 
     substantial evidence'' and insert ``is not arbitrary and 
     capricious''.
       On page 118, line 4, strike ``Panel'' and insert ``Court''.
       On page 118, lines 9 and 10, strike ``is not supported by 
     substantial evidence'' and insert ``is arbitrary and 
     capricious''.
       On page 118, line 10, strike ``Panel'' and insert 
     ``Court''.
       On page 118, between lines 16 and 17, insert the following:
       (v) Petition granted by operation of law.--If the Court 
     does not make a determination within 24 hours of receipt of 
     the petition--

       (I) the petition shall be granted by operation of law;
       (II) the Secretary shall appoint the Corporation as 
     receiver; and
       (III) liquidation under this title shall automatically and 
     without further notice or action be commenced and the 
     Corporation may immediately take all actions authorized under 
     this title.

       On page 118, line 18, strike ``Panel'' and insert 
     ``Court''.
       On page 118, line 23, strike ``Panel'' and insert 
     ``Court''.
       On page 119, line 1, strike ``Panel'' and insert ``Court''.
       On page 119, line 12, strike ``panel'' and insert 
     ``district court''.
       On page 119, line 16, strike ``Third Circuit'' and insert 
     ``District of Columbia Circuit''.
       On page 119, line 17, strike ``Panel'' and insert 
     ``Court''.
       On page 119, line 23, strike ``Panel'' and insert 
     ``Court''.
       On page 120, strike lines 16 through 17 and insert 
     ``default and satisfies the definition of a financial company 
     under section 201(10) is arbitrary and capricious.''.
       On page 121, lines 19 and 20, strike ``is supported by 
     substantial evidence'' and insert ``and satisfies the 
     definition of a financial company under section 201(10) is 
     arbitrary and capricious''.
       On page 121, line 21, strike ``(c)'' and insert ``(b)''.
       On page 121, line 24, strike ``Panel'' and insert 
     ``Court''.
       On page 122, line 5, strike ``subsection (b)(1)'' and all 
     that follows through line 9, and insert ``subsection 
     (a)(1).''.
       On page 122, strike lines 14 through 16.
       On page 122, line 17, strike ``(C)'' and insert ``(A)''.
       On page 122, line 19, strike ``(D)'' and insert ``(B)''.
       On page 122, line 21, strike ``(E)'' and insert ``(C)''.
       On page 122, line 23, strike ``(F)'' and insert ``(D)''.
       On page 123, line 1, strike ``(d)'' and insert ``(c)''.
       On page 123, between lines 14 and 15, insert the following:
       (d) Time Limit on Receivership Authority.--
       (1) Baseline period.--Any appointment of the Corporation as 
     receiver under this section shall terminate at the end of the 
     3-year period beginning on the date on which such appointment 
     is made.
       (2) Extension of time limit.--The time limit established in 
     paragraph (1) may be extended by the Corporation for up to 1 
     additional year, if the Chairperson of the Corporation 
     determines and certifies in writing to the Committee on 
     Banking, Housing, and Urban Affairs of the Senate and the 
     Committee on Financial Services of the House of 
     Representatives that continuation of the receivership is 
     necessary--
       (A) to--
       (i) maximize the net present value return from the sale or 
     other disposition of the assets of the covered financial 
     company; or
       (ii) minimize the amount of loss realized upon the sale or 
     other disposition of the assets of the covered financial 
     company; and
       (B) to protect the stability of the financial system of the 
     United States.
       (3) Second extension of time limit.--
       (A) In general.--The time limit under this subsection, as 
     extended under paragraph (2), may be extended for up to 1 
     additional year, if the Chairperson of the Corporation, with 
     the concurrence of the Secretary, submits the certifications 
     described in paragraph (2).
       (B) Additional report required.--Not later than 30 days 
     after the date of commencement of the extension under 
     subparagraph (A), the Corporation 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 need for the extension and 
     the specific plan of the Corporation to conclude the 
     receivership before the end of the second extension.
       (4) Ongoing litigation.--The time limit under this 
     subsection, as extended under paragraph (3), may be further 
     extended solely for the purpose of completing ongoing 
     litigation in which the Corporation as receiver is a party, 
     provided that the appointment of the Corporation as receiver 
     shall terminate not later than 90 days after the date of 
     completion of such litigation, if--
       (A) the Council determines that the Corporation used its 
     best efforts to conclude the receivership in accordance with 
     its plan before the end of the time limit described in 
     paragraph (3);
       (B) the Council determines that the completion of longer-
     term responsibilities in the form of ongoing litigation 
     justifies the need for an extension; and
       (C) the Corporation submits a report approved by the 
     Council not later than 30 days after the date of the 
     determinations by the Council under subparagraphs (A) and (B) 
     to the Committee on Banking, Housing, and Urban Affairs of 
     the Senate and the Committee on Financial Services of the 
     House of Representatives, describing--
       (i) the ongoing litigation justifying the need for an 
     extension; and
       (ii) the specific plan of the Corporation to complete the 
     litigation and conclude the receivership.

[[Page S3224]]

       (5) Regulations.--The Corporation may issue regulations 
     governing the termination of receiverships under this title.
       (6) No liability.--The Corporation and the Deposit 
     Insurance Fund shall not be liable for unresolved claims 
     arising from the receivership after the termination of the 
     receivership.
       On page 123, line 21, strike ``Panel'' and insert 
     ``Court''.
       On page 124, line 11, strike ``Panel'' and insert 
     ``Court''.
       On page 126, between lines 9 and 10, insert the following:
       (g) Study of Prompt Corrective Action Implementation by the 
     Appropriate Federal Agencies.--
       (1) Study.--The Comptroller General of the United States 
     shall conduct a study regarding the implementation of prompt 
     corrective action by the appropriate Federal banking 
     agencies.
       (2) Issues to be studied.--In conducting the study under 
     paragraph (1), the Comptroller General shall evaluate--
       (A) the effectiveness of implementation of prompt 
     corrective action by the appropriate Federal banking agencies 
     and the resolution of insured depository institutions by the 
     Corporation; and
       (B) ways to make prompt corrective action a more effective 
     tool to resolve the insured depository institutions at the 
     least possible long-term cost to the Deposit Insurance Fund.
       (3) Report to council.--Not later than 1 years after the 
     date of enactment of this Act, the Comptroller General shall 
     submit a report to the Council on the results of the study 
     conducted under this subsection.
       (4) Council report of action.--Not later than 6 months 
     after the date of receipt of the report from the Comptroller 
     General under paragraph (3), the Council 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 on actions taken in response 
     to the report, including any recommendations made to the 
     Federal primary financial regulatory agencies under section 
     120.
       On page 128, line 9, strike ``and''.
       On page 128, line 12, strike the period at the end and 
     insert ``; and''.
       On page 128, between lines 12 and 13, insert the following:
       (G) an evaluation of whether the company satisfies the 
     definition of a financial company under section 201.
       On page 128, line 16, strike ``202(b)(1)(A)'' and insert 
     ``202(a)(1)(A)''.
       On page 129, line 17, strike ``and''.
       On page 129, line 21, strike the period at the end and 
     insert ``; and''.
       On page 129, between lines 21 and 22, insert the following:
       (7) the company satisfies the definition of a financial 
     company under section 201.
       On page 132, strike lines 3 through 17, and insert the 
     following:
       (A) In general.--Not later than 60 days after the date of 
     appointment of the Corporation as receiver for a covered 
     financial company, the Corporation shall file a report with 
     the Committee on Banking, Housing, and Urban Affairs of the 
     Senate and the Committee on Financial Services of the House 
     of Representatives--
       (i) setting forth information on the financial condition of 
     the covered financial company as of the date of the 
     appointment, including a description of its assets and 
     liabilities;
       (ii) describing the plan of, and actions taken by, the 
     Corporation to wind down the covered financial company;
       (iii) explaining each instance in which the Corporation 
     waived any applicable requirements of part 366 of title 12, 
     Code of Federal Regulations (or any successor thereto) with 
     respect to conflicts of interest by any person in the private 
     sector who was retained to provide services to the 
     Corporation in connection with such receivership;
       (iv) describing the reasons for the provision of any 
     funding to the receivership out of the Fund;
       (v) setting forth the expected costs of the orderly 
     liquidation of the covered financial company;
       (vi) setting forth the identity of any claimant that is 
     treated in a manner different from other similarly situated 
     claimants under subsection (b)(4), (d)(4), or (h)(5)(E), the 
     amount of any additional payment to such claimant under 
     subsection (d)(4), and the reason for any such action; and
       (vii) which report the Corporation shall publish on an 
     online website maintained by the Corporation, subject to 
     maintaining appropriate confidentiality.
       On page 132, between lines 22 and 23, insert the following:
       (C) Congressional testimony.--The Corporation and the 
     primary financial regulatory agency, if any, of the financial 
     company for which the Corporation was appointed receiver 
     under this title shall appear before Congress, if requested, 
     not later than 30 days after the date on which the 
     Corporation first files the reports required under 
     subparagraph (A).
       On page 135, line 15, strike ``section 202(b)'' and insert 
     ``section 202(a)''.
       On page 136, line 9, strike ``with the strong presumption'' 
     and insert ``so''.
       On page 138, line 16, insert after the period the 
     following: ``All funds provided by the Corporation under this 
     subsection shall have a priority of claims under subparagraph 
     (A) or (B) of section 210(b)(1), as applicable, including 
     funds used for--
       ``(1) making loans to, or purchasing any debt obligation 
     of, the covered financial company or any covered subsidiary;
       ``(2) purchasing or guaranteeing against loss the assets of 
     the covered financial company or any covered subsidiary, 
     directly or through an entity established by the Corporation 
     for such purpose;
       ``(3) assuming or guaranteeing the obligations of the 
     covered financial company or any covered subsidiary to 1 or 
     more third parties;
       ``(4) taking a lien on any or all assets of the covered 
     financial company or any covered subsidiary, including a 
     first priority lien on all unencumbered assets of the covered 
     financial company or any covered subsidiary to secure 
     repayment of any transactions conducted under this 
     subsection;
       ``(5) selling or transferring all, or any part, of such 
     acquired assets, liabilities, or obligations of the covered 
     financial company or any covered subsidiary; and
       ``(6) making payments pursuant to subsections (b)(4), 
     (d)(4), and (h)(5)(E) of section 210.''.
       On page 138, line 15, strike ``section 210(n)(13)'' and 
     insert ``section 210(n)(11)''.
       On page 147, line 3, insert before the period the 
     following: ``, and address the potential for conflicts of 
     interest between or among individual receiverships 
     established under this title or under the Federal Deposit 
     Insurance Act''.
       On page 187, line 18, strike ``(B), and (C)'' and insert 
     ``(B), (C), and (D)''.
       On page 187, line 20, strike ``(D)'' and insert ``(E)''.
       On page 192, insert before line 1 the following:
       (C) Wages, salaries, or commissions, including vacation, 
     severance, and sick leave pay earned by an individual (other 
     than an individual described in subparagraph (G)), but only 
     to the extent of $11,725 for each individual (as indexed for 
     inflation, by regulation of the Corporation) earned not later 
     than 180 days before the date of appointment of the 
     Corporation as receiver.
       (D) Contributions owed to employee benefit plans arising 
     from services rendered not later than 180 days before the 
     date of appointment of the Corporation as receiver, to the 
     extent of the number of employees covered by each such plan, 
     multiplied by $11,725 (as indexed for inflation, by 
     regulation of the Corporation), less the aggregate amount 
     paid to such employees under subparagraph (C), plus the 
     aggregate amount paid by the receivership on behalf of such 
     employees to any other employee benefit plan.
       On page 192, line 1, strike ``(C)'' and insert ``(E)''.
       On page 192, beginning on line 3, strike ``(D) or (E)'' and 
     insert ``(F), (G), or (H)''.
       On page 192, line 5, strike ``(D)'' and insert ``(F)''.
       On page 192, between lines 7 and 8, insert the following:
       (G) Any wages, salaries, or commissions including vacation, 
     severance, and sick leave pay earned, owed to senior 
     executives and directors of the covered financial company.
       On page 192, line 7, strike ``subparagraph (E)).'' and 
     insert ``subparagraph (G) or (H)).''.
       On page 192, line 8, strike ``(E)'' and insert ``(H)''.
       On page 193, line 18, strike ``(ii)'' and insert the 
     following:
       ``(ii) to initiate and continue operations essential to 
     implementation of the receivership or any bridge financial 
     company;
       ``(iii)''.
       On page 228, line 17, strike ``5th'' and insert ``3rd''.
       On page 236, line 20, strike ``5th'' and insert ``3rd''.
       On page 237, line 14, strike ``5th'' and insert ``3rd''.
       On page 240, line 8, strike ``section 202(c)(1)'' and 
     insert ``section 202(a)(1)''.
       On page 246, strike line 21 and all the follows through 
     page 247, line 5, and insert the following:
       (B) Limitations.--
       (i) Prohibition.--The Corporation shall not make any 
     payments or credit amounts to any claimant or category of 
     claimants that would result in any claimant receiving more 
     than the face value amount of any claim that is proven to the 
     satisfaction of the Corporation.
       (ii) No obligation.--Notwithstanding any other provision of 
     Federal or State law, or the Constitution of any State, the 
     Corporation shall not be obligated, as a result of having 
     made any payment under subparagraph (A) or credited any 
     amount described in subparagraph (A) to or with respect to, 
     or for the account, of any claimant or category of claimants, 
     to make payments to any other claimant or category of 
     claimants.
       On page 254, line 24, strike ``(13)'' and insert ``(11)''.
       On page 260, line 4, strike ``subsection (o)(1)(E)(ii))'' 
     and insert ``subsection (o)(1)(D)(ii))''.
       On page 263, line 16, strike ``(13)'' and insert ``(11)''.
       On page 278, line 5, strike ``(9)'' and insert ``(6)''.
       On page 278, line 10, strike ``(9)'' and insert ``(6)''.
       On page 278, strike line 18 and all that follows through 
     page 279, line 20.
       On page 279, line 21, strike ``(8)'' and insert ``(4)''.
       On page 280, line 5, strike ``(9)'' and insert ``(5)''.
       On page 281, line 6, strike the period and insert the 
     following: ``, plus an interest rate surcharge to be 
     determined by the Secretary,

[[Page S3225]]

     which shall be greater than the difference between--
       ``(i) the current average rate on an index of corporate 
     obligations of comparable maturity; and
       ``(ii) the current average rate on outstanding marketable 
     obligations of the United States of comparable maturity.''.
       On page 281, strike line 20 and all that follows through 
     page 282, line 8, and insert the following:
       (6) Maximum obligation limitation.--The Corporation may 
     not, in connection with the orderly liquidation of a covered 
     financial company, issue or incur any obligation, if, after 
     issuing or incurring the obligation, the aggregate amount of 
     such obligations outstanding under this subsection for each 
     covered financial company would exceed--
       (A) an amount that is equal to 10 percent of the total 
     consolidated assets of the covered financial company, based 
     on the most recent financial statement available, during the 
     30-day period immediately following the date of appointment 
     of the Corporation as receiver (or a shorter time period if 
     the Corporation has calculated the amount described under 
     subparagraph (B)); and
       (B) the amount that is equal to 90 percent of the fair 
     value of the total consolidated assets of each covered 
     financial company that are available for repayment, after the 
     time period described in subparagraph (A).
       On page 282, line 9, strike ``(11)'' and insert ``(7)''.
       On page 282, strike lines 14 through 19.
       On page 282, line 20, strike ``(13)'' and insert ``(8)''.
       On page 283, strike lines 5 through 14 and insert the 
     following:
       (i) the authorities of the Corporation contained in this 
     title shall not be used to assist the Deposit Insurance Fund 
     or to assist any financial company under applicable law other 
     than this Act;
       (ii) the authorities of the Corporation relating to the 
     Deposit Insurance Fund, or any other responsibilities of the 
     Corporation under applicable law other than this title, shall 
     not be used to assist a covered financial company pursuant to 
     this title; and
       (iii) the Deposit Insurance Fund may not be used in any 
     manner to otherwise circumvent the purposes of this title.
       On page 283, line 24, strike ``(14)'' and insert ``(9)''.
       On page 284, line 6, insert ``, including taking any 
     actions specified'' before ``under 204(d)''.
       On page 284, line 7, insert before the period ``, and 
     payments to third parties''.
       On page 284, between lines 10 and 11, insert the following:
       (10) Implementation expenses.--
       (A) In general.--Reasonable implementation expenses of the 
     Corporation incurred after the date of enactment of this Act 
     shall be treated as expenses of the Council.
       (B) Requests for reimbursement.--The Corporation shall 
     periodically submit a request for reimbursement for 
     implementation expenses to the Chairperson of the Council, 
     who shall arrange for prompt reimbursement to the Corporation 
     of reasonable implementation expenses.
       (C) Definition.--As used in this paragraph, the term 
     ``implementation expenses''--
       (i) means costs incurred by the Corporation beginning on 
     the date of enactment of this Act, as part of its efforts to 
     implement this title that do not relate to a particular 
     covered financial company; and
       (ii) includes the costs incurred in connection with the 
     development of policies, procedures, rules, and regulations 
     and other planning activities of the Corporation consistent 
     with carrying out this title.
       On page 284, strike line 13 and all that follows through 
     page 285, line 2.
       On page 285, line 3, strike ``(B)'' and insert ``(A)''.
       On page 285, line 10, strike ``(C)'' and insert ``(B)''.
       On page 285, line 10, strike ``Additional''.
       On page 285, line 13, strike ``(E)'' and insert ``(D)''.
       On page 285, strike lines 14 through 23.
       On page 285, line 24, strike ``(iii)''.
       On page 285, line 21, strike ``during the initial 
     capitalization period''.
       On page 286, strike line 11 and all that follows through 
     page 287, line 2, and insert the following:
       (D) Application of assessments.--To meet the requirements 
     of subparagraph (C), the Corporation shall--
       (i) impose assessments, as soon as practicable, on any 
     claimant that received additional payments or amounts from 
     the Corporation pursuant to subsection (b)(4), (d)(4), or 
     (h)(5)(E), except for payments or amounts necessary to 
     initiate and continue operations essential to implementation 
     of the receivership or any bridge financial company, to 
     recover on a cumulative basis, the entire difference 
     between--

       (I) the aggregate value the claimant received from the 
     Corporation on a claim pursuant to this title (including 
     pursuant to subsection (b)(4), (d)(4), and (h)(5)(E)), as of 
     the date on which such value was received; and
       (II) the value the claimant was entitled to receive from 
     the Corporation on such claim solely from the proceeds of the 
     liquidation of the covered financial company under this 
     title; and

       (ii) if the amounts to be recovered on a cumulative basis 
     under clause (i) are insufficient to meet the requirements of 
     subparagraph (C), after taking into account the 
     considerations set forth in paragraph (4), impose assessments 
     on--

       (I) eligible financial companies; and
       (II) financial companies with total consolidated assets 
     equal to or greater than $50,000,000,000 that are not 
     eligible financial companies.

       (E) Provision of financing.--Payments or amounts necessary 
     to initiate and continue operations essential to 
     implementation of the receivership or any bridge financial 
     company described in subparagraph (E)(i) shall not include 
     the provision of financing, as defined by rule of the 
     Corporation, to third parties.
       On page 287, strike lines 3 through 10.
       On page 289, strike line 25, and insert ``the Corporation, 
     in consultation with the Secretary, deems appropriate.''.
       On page 290, beginning on line 9, strike ``, in 
     consultation with the Secretary and the Council,''.
       On page 290, line 11, insert after the period the 
     following: ``The Corporation shall consult with the Secretary 
     in the development and finalization of such regulations.''.
       On page 295, between lines 19 and 20, insert the following:
       (s) Recoupment of Compensation From Senior Executives and 
     Directors.--
       (1) In general.--The Corporation, as receiver of a covered 
     financial company, may recover from any current or former 
     senior executive or director substantially responsible for 
     the failed condition of the covered financial company any 
     compensation received during the 2-year period preceding the 
     date on which the Corporation was appointed as the receiver 
     of the covered financial company, except that, in the case of 
     fraud, no time limit shall apply.
       (2) Cost considerations.--In seeking to recover any such 
     compensation, the Corporation shall weigh the financial and 
     deterrent benefits of such recovery against the cost of 
     executing the recovery.
       (3) Rulemaking.--The Corporation shall promulgate 
     regulations to implement the requirements of this subsection, 
     including defining the term ``compensation'' to mean any 
     financial remuneration, including salary, bonuses, 
     incentives, benefits, severance, deferred compensation, or 
     golden parachute benefits, and any profits realized from the 
     sale of the securities of the covered financial company.
       On page 296, between lines 15 and 16, insert the following:
       (d) FDIC Inspector General Reviews.--
       (1) Scope.--The Inspector General of the Corporation shall 
     conduct, supervise, and coordinate audits and investigations 
     of the liquidation of any covered financial company by the 
     Corporation as receiver under this title, including 
     collecting and summarizing--
       (A) a description of actions taken by the Corporation as 
     receiver;
       (B) a description of any material sales, transfers, 
     mergers, obligations, purchases, and other material 
     transactions entered into by the Corporation;
       (C) an evaluation of the adequacy of the policies and 
     procedures of the Corporation under section 203(d) and 
     orderly liquidation plan under section 210(n)(14);
       (D) an evaluation of the utilization by the Corporation of 
     the private sector in carrying out its functions, including 
     the adequacy of any conflict-of-interest reviews; and
       (E) an evaluation of the overall performance of the 
     Corporation in liquidating the covered financial company, 
     including administrative costs, timeliness of liquidation 
     process, and impact on the financial system.
       (2) Frequency.--Not later than 6 months after the date of 
     appointment of the Corporation as receiver under this title 
     and every 6 months thereafter, the Inspector General of the 
     Corporation shall conduct the audit and investigation 
     described in paragraph (1).
       (3) Reports and testimony.--The Inspector General of the 
     Corporation shall include in the semiannual reports required 
     by section 5(a) of the Inspector General Act of 1978 (5 
     U.S.C. App.), a summary of the findings and evaluations under 
     paragraph (1), and shall appear before the appropriate 
     committees of Congress, if requested, to present each such 
     report.
       (4) Funding.--
       (A) Initial funding.--The expenses of the Inspector General 
     of the Corporation in carrying out this subsection shall be 
     considered administrative expenses of the receivership.
       (B) Additional funding.--If the maximum amount available to 
     the Corporation as receiver under this title is insufficient 
     to enable the Inspector General of the Corporation to carry 
     out the duties under this subsection, the Corporation shall 
     pay such additional amounts from assessments imposed under 
     section 210.
       (5) Termination of responsibilities.--The duties and 
     responsibilities of the Inspector General of the Corporation 
     under this subsection shall terminate 1 year after the date 
     of termination of the receivership under this title.
       (e) Treasury Inspector General Reviews.--
       (1) Scope.--The Inspector General of the Department of the 
     Treasury shall conduct, supervise, and coordinate audits and 
     investigations of actions taken by the Secretary related to 
     the liquidation of any covered financial company under this 
     title, including collecting and summarizing--
       (A) a description of actions taken by the Secretary under 
     this title;
       (B) an analysis of the approval by the Secretary of the 
     policies and procedures of the

[[Page S3226]]

     Corporation under section 203 and acceptance of the orderly 
     liquidation plan of the Corporation under section 210; and
       (C) an assessment of the terms and conditions underlying 
     the purchase by the Secretary of obligations of the 
     Corporation under section 210.
       (2) Frequency.--Not later than 6 months after the date of 
     appointment of the Corporation as receiver under this title 
     and every 6 months thereafter, the Inspector General of the 
     Department of the Treasury shall conduct the audit and 
     investigation described in paragraph (1).
       (3) Reports and testimony.--The Inspector General of the 
     Department of the Treasury shall include in the semiannual 
     reports required by section 5(a) of the Inspector General Act 
     of 1978 (5 U.S.C. App.), a summary of the findings and 
     assessments under paragraph (1), and shall appear before the 
     appropriate committees of Congress, if requested, to present 
     each such report.
       (4) Termination of responsibilities.--The duties and 
     responsibilities of the Inspector General of the Department 
     of the Treasury under this subsection shall terminate 1 year 
     after the date on which the obligations purchased by the 
     Secretary from the Corporation under section 210 are fully 
     redeemed.
       (f) Primary Financial Regulatory Agency Inspector General 
     Reviews.--
       (1) Scope.--Upon the appointment of the Corporation as 
     receiver for a covered financial company supervised by a 
     Federal primary financial regulatory agency or the Board of 
     Governors under section 165, the Inspector General of the 
     agency or the Board of Governors shall make a written report 
     reviewing the supervision by the agency or the Board of 
     Governors of the covered financial company, which shall--
       (A) evaluate the effectiveness of the agency or the Board 
     of Governors in carrying out its supervisory responsibilities 
     with respect to the covered financial company;
       (B) identify any acts or omissions on the part of agency or 
     Board of Governors officials that contributed to the covered 
     financial company being in default or in danger of default;
       (C) identify any actions that could have been taken by the 
     agency or the Board of Governors that would have prevented 
     the company from being in default or in danger of default; 
     and
       (D) recommend appropriate administrative or legislative 
     action.
       (2) Reports and testimony.--Not later than 1 year after the 
     date of appointment of the Corporation as receiver under this 
     title, the Inspector General of the Federal primary financial 
     regulatory agency or the Board of Governors shall provide the 
     report required by paragraph (1) to such agency or the Board 
     of Governors, and along with such agency or the Board of 
     Governors, as applicable, shall appear before the appropriate 
     committees of Congress, if requested, to present the report 
     required by paragraph (1). Not later than 90 days after the 
     date of receipt of the report required by paragraph (1), such 
     agency or the Board of Governors, as applicable, shall 
     provide a written report to Congress describing any actions 
     taken in response to the recommendations in the report, and 
     if no such actions were taken, describing the reasons why no 
     actions were taken.

     SEC. 212. PROHIBITION OF CIRCUMVENTION AND PREVENTION OF 
                   CONFLICTS OF INTEREST.

       (a) No Other Funding.--Funds for the orderly liquidation of 
     any covered financial company under this title shall only be 
     provided as specified under this title.
       (b) Limit on Governmental Actions.--No governmental entity 
     may take any action to circumvent the purposes of this title.
       (c) Conflict of Interest.--In the event that the 
     Corporation is appointed receiver for more than 1 covered 
     financial company or is appointed receiver for a covered 
     financial company and receiver for any insured depository 
     institution that is an affiliate of such covered financial 
     company, the Corporation shall take appropriate action, as 
     necessary to avoid any conflicts of interest that may arise 
     in connection with multiple receiverships.

     SEC. 213. BAN ON SENIOR EXECUTIVES AND DIRECTORS.

       (a) Prohibition Authority.--The Board of Governors or, if 
     the covered financial company was not supervised by the Board 
     of Governors, the Corporation, may exercise the authority 
     provided by this section.
       (b) Authority To Issue Order.--The appropriate agency 
     described in subsection (a) may take any action authorized by 
     subsection (c), if the agency determines that--
       (1) a senior executive or a director of the covered 
     financial company, prior to the appointment of the 
     Corporation as receiver, has, directly or indirectly--
       (A) violated--
       (i) any law or regulation;
       (ii) any cease-and-desist order which has become final;
       (iii) any condition imposed in writing by a Federal agency 
     in connection with any action on any application, notice, or 
     request by such company or senior executive; or
       (iv) any written agreement between such company and such 
     agency;
       (B) engaged or participated in any unsafe or unsound 
     practice in connection with any financial company; or
       (C) committed or engaged in any act, omission, or practice 
     which constitutes a breach of the fiduciary duty of such 
     senior executive or director;
       (2) by reason of the violation, practice, or breach 
     described in any clause of paragraph (1), such senior 
     executive or director has received financial gain or other 
     benefit by reason of such violation, practice, or breach and 
     such violation, practice, or breach contributed to the 
     failure of the company; and
       (3) such violation, practice, or breach--
       (A) involves personal dishonesty on the part of such senior 
     executive or director; or
       (B) demonstrates willful or continuing disregard by such 
     senior executive or director for the safety or soundness of 
     such company.
       (c) Authorized Actions.--
       (1) In general.--The appropriate agency for a financial 
     company, as described in subsection (a), may serve upon a 
     senior executive or director described in subsection (b) a 
     written notice of the intention of the agency to prohibit any 
     further participation by such person, in any manner, in the 
     conduct of the affairs of any financial company for a period 
     of time determined by the appropriate agency to be 
     commensurate with such violation, practice, or breach, 
     provided such period shall be not less than 2 years.
       (2) Procedures.--The due process requirements and other 
     procedures under section 8(e) of the Federal Deposit 
     Insurance Act shall apply to actions under this section as if 
     the covered financial company were an insured depository 
     institution and the senior executive or director were an 
     institution-affiliated party, as those terms are defined in 
     that Act.
       (d) Regulations.--The Corporation and the Board of 
     Governors, in consultation with the Council, shall jointly 
     prescribe rules or regulations to administer and carry out 
     this section, including rules, regulations, or guidelines to 
     further define the term senior executive for the purposes of 
     this section.
       On page 1522, line 11, strike ``The third'' and insert the 
     following:
       ``(a) Federal Reserve Act.--The third''.
       On page 1528, line 3, strike the end quotation marks and 
     the final period and insert the following:
       ``(E) If an entity to which a Federal reserve bank has 
     provided a loan under this paragraph becomes a covered 
     financial company, as defined in section 203 of the Restoring 
     American Financial Stability Act of 2010, at any time while 
     such loan is outstanding, and the Federal reserve bank incurs 
     a realized net loss on the loan, then the Federal reserve 
     bank shall have a claim equal to the amount of the net 
     realized loss against the covered entity, with the same 
     priority as an obligation to the Secretary of the Treasury 
     under sections 210(n) and 210(o) of the Restoring American 
     Financial Stability Act of 2010.''.
       (b) Conforming Amendment.--Section 507(a)(2) of title 11, 
     United States Code, is amended by inserting ``claims of any 
     Federal reserve bank related to loans made through programs 
     or facilities authorized under the third undesignated 
     paragraph of the Federal Reserve Act ( 12 U.S.C. 343),'' 
     after ``this title,''.
       On page 1523, line 17, strike ``of sufficient quality'' and 
     insert ``sufficient''.
       On page 1523, line 18, insert after the period the 
     following: ``The policies and procedures established by the 
     Board shall require that a Federal reserve bank assign, 
     consistent with sound risk management practices and to ensure 
     protection for the taxpayer, a lendable value to all 
     collateral for a loan executed by a Federal reserve bank 
     under this paragraph in determining whether the loan is 
     secured satisfactorily for purposes of this paragraph.''.
       On page 1523, line 19, strike ``(ii)'' and insert the 
     following:
       ``(ii) The Board shall establish procedures to prohibit 
     borrowing from programs and facilities by borrowers that are 
     insolvent. Such procedures may include a certification from 
     the chief executive officer (or other authorized officer) of 
     the borrower, at the time the borrower initially borrows 
     under the program or facility (with a duty by the borrower to 
     update the certification if the information in the 
     certification materially changes), that the borrower is not 
     insolvent. A borrower shall be considered insolvent for 
     purposes of this subparagraph, if the borrower is in 
     bankruptcy, resolution under title II of the Restoring 
     American Financial Stability Act of 2010, or any other 
     Federal or State insolvency proceeding.
       ``(iii) A program or facility that is structured to remove 
     assets from the balance sheet of a single and specific 
     company, or that is established for the purpose of assisting 
     a single and specific company avoid bankruptcy, resolution 
     under title II of the Restoring American Financial Stability 
     Act of 2010, or any other Federal or State insolvency 
     proceeding, shall not be considered a program or facility 
     with broad-based eligibility.
       ``(iv)''.
       On page 1523, line 18: insert ``and that any such program 
     is terminated in a timely and orderly fashion'' before 
     ``losses''.
       On page 1524, line 11, strike ``assistance,'' and all that 
     follows through line 12 and insert ``assistance.''.
       On page 1525, strike line 21 and all that follows through 
     page 1528, line 3, and insert the following:
       ``(D) The information submitted to Congress under 
     subparagraph (C) related to--
       ``(i) the identity of the participants in an emergency 
     lending program or facility commenced under this paragraph;
       ``(ii) the amounts borrowed by each participant in any such 
     program or facility;
       ``(iii) identifying details concerning the assets or 
     collateral held by, under, or in connection with such a 
     program or facility,

[[Page S3227]]

     shall be kept confidential, upon the written request of the 
     Chairman of the Board, in which case such information shall 
     be made available only to the Chairpersons and Ranking 
     Members of the Committees described in subparagraph (C).''.
       On page 1537, line 23, insert before the period the 
     following: ``and a request for approval of such plan''.
       On page 1537, line 23, strike ``Upon'' and all that follows 
     through page 1538, line 6, and insert the following: ``The 
     Corporation shall exercise the authority under this section 
     to issue guarantees up to that specified maximum amount upon 
     passage of the joint resolution of approval, as provided in 
     subsection (d). Absent such approval, the Corporation shall 
     issue no such guarantees.''.
       On page 1538, line 16, strike ``Upon'' and all that follows 
     through page 1547, line 6 and insert the following: ``The 
     Corporation shall exercise the authority under this section 
     to issue guarantees up to that specified maximum amount upon 
     passage of the joint resolution of approval, as provided in 
     subsection (d). Absent such approval, the Corporation shall 
     issue no such guarantees.
       ``(d) Resolution of Approval.--
       ``(1) Additional debt guarantee authority.--A request by 
     the President under this section shall be considered granted 
     by Congress upon adoption of a joint resolution approving 
     such request. Such joint resolution shall be considered in 
     the Senate under expedited procedures.
       ``(2) Fast track consideration in senate.--
       ``(A) Reconvening.--Upon receipt of a request under 
     subsection (c), if the Senate has adjourned or recessed for 
     more than 2 days, the majority leader of the Senate, after 
     consultation with the minority leader of the Senate, shall 
     notify the Members of the Senate that, pursuant to this 
     section, the Senate shall convene not later than the second 
     calendar day after receipt of such message.
       ``(B) Placement on calendar.--Upon introduction in the 
     Senate, the joint resolution shall be placed immediately on 
     the calendar.
       ``(C) Floor consideration.--
       ``(i) In general.--Notwithstanding Rule XXII of the 
     Standing Rules of the Senate, it is in order at any time 
     during the period beginning on the 4th day after the date on 
     which Congress receives a request under subsection (c), and 
     ending on the 7th day after that date (even though a previous 
     motion to the same effect has been disagreed to) to move to 
     proceed to the consideration of the joint resolution, and all 
     points of order against the joint resolution (and against 
     consideration of the joint resolution) are waived. The motion 
     to proceed is not debatable. The motion is not subject to a 
     motion to postpone. A motion to reconsider the vote by which 
     the motion is agreed to or disagreed to shall not be in 
     order. If a motion to proceed to the consideration of the 
     resolution is agreed to, the joint resolution shall remain 
     the unfinished business until disposed of.
       ``(ii) Debate.--Debate on the joint resolution, and on all 
     debatable motions and appeals in connection therewith, shall 
     be limited to not more than 10 hours, which shall be divided 
     equally between the majority and minority leaders or their 
     designees. A motion further to limit debate is in order and 
     not debatable. An amendment to, or a motion to postpone, or a 
     motion to proceed to the consideration of other business, or 
     a motion to recommit the joint resolution is not in order.
       ``(iii) Vote on passage.--The vote on passage shall occur 
     immediately following the conclusion of the debate on the 
     joint resolution, and a single quorum call at the conclusion 
     of the debate if requested in accordance with the rules of 
     the Senate.
       ``(iv) Rulings of the chair on procedure.--Appeals from the 
     decisions of the Chair relating to the application of the 
     rules of the Senate, as the case may be, to the procedure 
     relating to a joint resolution shall be decided without 
     debate.
       ``(3) Rules.--
       ``(A) Coordination with action by house of 
     representatives.--If, before the passage by the Senate of a 
     joint resolution of the Senate, the Senate receives a joint 
     resolution, from the House of Representatives, then the 
     following procedures shall apply:
       ``(i) The joint resolution of the House of Representatives 
     shall not be referred to a committee.
       ``(ii) With respect to a joint resolution of the Senate--

       ``(I) the procedure in the Senate shall be the same as if 
     no joint resolution had been received from the other House; 
     but
       ``(II) the vote on passage shall be on the joint resolution 
     of the House of Representatives.

       ``(B) Treatment of joint resolution of house of 
     representatives.--If the Senate fails to introduce or 
     consider a joint resolution under this section, the joint 
     resolution of the House of Representatives shall be entitled 
     to expedited floor procedures under this subsection.
       ``(C) Treatment of companion measures.--If, following 
     passage of the joint resolution in the Senate, the Senate 
     then receives the companion measure from the House of 
     Representatives, the companion measure shall not be 
     debatable.
       ``(D) Rules of the senate.--This subsection is enacted by 
     Congress--
       ``(i) as an exercise of the rulemaking power of the Senate, 
     and as such it is deemed a part of the rules of the Senate, 
     but applicable only with respect to the procedure to be 
     followed in the Senate in the case of a joint resolution, and 
     it supersedes other rules, only to the extent that it is 
     inconsistent with such rules; and
       ``(ii) with full recognition of the constitutional right of 
     the Senate to change the rules (so far as relating to the 
     procedure of the Senate) at any time, in the same manner, and 
     to the same extent as in the case of any other rule of the 
     Senate.
       ``(4) Definition.--As used in this subsection, the term 
     `joint resolution' means only a joint resolution--
       ``(A) that is introduced not later than 3 calendar days 
     after the date on which the request referred to in subsection 
     (c) is received by Congress;
       ``(B) that does not have a preamble;
       ``(C) the title of which is as follows: `Joint resolution 
     relating to the approval of a plan to guarantee obligations 
     under section 1155 of the Restoring American Financial 
     Stability Act of 2010'; and
       ``(D) the matter after the resolving clause of which is as 
     follows: `That Congress approves the obligation of any amount 
     described in section 1155(c) of the Restoring American 
     Financial Stability Act of 2010.'.''.
       On page 1550, strike lines 1 through 12, and insert the 
     following:
       (3) Liquidity event.--The term ``liquidity event'' means--
       (A) an exceptional and broad reduction in the general 
     ability of financial market participants--
       (i) to sell financial assets without an unusual and 
     significant discount; or
       (ii) to borrow using financial assets as collateral without 
     an unusual and significant increase in margin; or
       (B) an unusual and significant reduction in the ability of 
     financial market participants to obtain unsecured credit.
       On page 1550, strike line 24 and all that follows through 
     page 1551, line 3, and insert the following:
       (b) Federal Deposit Insurance Act.--Section 13(c)(4)(G) of 
     the Federal Deposit Insurance Act (12 U.S.C. 1823(c)(4)(G)) 
     is amended--
       (1) in clause (i)--
       (A) in subclause (I), by inserting ``for which the 
     Corporation has been appointed receiver'' before ``would have 
     serious''; and
       (B) in the undesignated matter following subclause (II), by 
     inserting ``for the purpose of winding up the insured 
     depository institution for which the Corporation has been 
     appointed receiver'' after ``provide assistance under this 
     section''; and
       (2) in clause (v)(I), by striking ``The'' and inserting 
     ``Not later than 3 days after making a determination under 
     clause (i), the''.
                                 ______
                                 
  SA 3828. Ms. MURKOWSKI submitted an amendment intended to be proposed 
to amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for himself 
and Mrs. Lincoln)) to the bill S. 3217, to promote the financial 
stability of the United States by improving accountability and 
transparency in the financial system, to end ``too big to fail,'' to 
protect the American taxpayer by ending bailouts, to protect consumers 
from abusive financial services practices, and for other purposes; 
which was ordered to lie on the table; as follows:

       On page 1270, after line 21, insert the following:
       (f) Scope of Authority.--No regulation promulgated under 
     the rulemaking authority of the Bureau under this title shall 
     be enforceable with respect to an entity that has not 
     violated a consumer protection statute and is--
       (1) an insured depository institution with assets of not 
     more than $5,000,000,000;
       (2) an insured credit union with assets of not more than 
     $5,000,000,000; or
       (3) a nonfinancial institution,

     until such time as the Bureau certifies that the regulation 
     will not result in an unfunded mandate, increase costs for 
     consumers, or reduce the availability of credit and credit 
     products.
                                 ______
                                 
  SA 3829. Ms. MURKOWSKI submitted an amendment intended to be proposed 
to amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for himself 
and Mrs. Lincoln)) to the bill S. 3217, to promote the financial 
stability of the United States by improving accountability and 
transparency in the financial system, to end ``too big to fail,'' to 
protect the American taxpayer by ending bailouts, to protect consumers 
from abusive financial services practices, and for other purposes; 
which was ordered to lie on the table; as follows:

       On page 1270, after line 21, insert the following:
       (f) Exemptions.--Each insured depository institution or 
     insured credit union with assets of not more than 
     $5,000,000,000, and that has not violated the consumer 
     protection statutes is exempt from the regulations of the 
     Bureau. Supervision and enforcement for such institutions 
     shall remain with the primary prudential regulator for such 
     institutions.

[[Page S3228]]

                                 ______
                                 
  SA 3830. Mr. VITTER submitted an amendment intended to be proposed by 
Mr. Reid (for Mr. Dodd (for himself and Mrs. Lincoln)) to the bill S. 
3217, to promote the financial stability of the United States by 
improving accountability and transparency in the financial system, to 
end ``too big to fail'', to protect the American taxpayer by ending 
bailouts, to protect consumers from abusive financial services 
practices, and for other purposes; which was ordered to lie on the 
table; as follows:

       At the end of title II, add the following:

     SEC. 212. PROHIBITION ON ALL BAILOUTS.

       (a) Prohibition.-- The United States Government shall not 
     use any funds to bail out creditors or shareholders of any 
     company by paying to any creditor or shareholder, under this 
     or any title, any funds for the purpose of covering the 
     losses of such creditor or shareholder on its investments in 
     such company or ensuring that the amount that such claimant 
     receives on a claim is more than such claimant is entitled to 
     receive on such claim under the Bankruptcy Code. The United 
     States Government shall not coordinate with or participate in 
     any effort involving any foreign or multi-national entity to 
     use foreign or multi-national resources to circumvent the 
     purposes of this title.
       (b) Reestablishing the Federal Reserve Lender of Last 
     Resort Function.--
       (1) Rulemaking required.--Notwithstanding any provision of 
     this Act or any other provision of law, the Board of 
     Governors, in consultation with the Secretary, shall, not 
     later than 12 months after the date of enactment of this Act, 
     issue rules that shall govern the creation of any emergency 
     stabilization actions by the Board of Governors.
       (2) Requirements.--At a minimum, rules required under this 
     subsection shall--
       (A) prescribe under what circumstances the program may and 
     may not be used in the future;
       (B) prescribe how the program shall ensure that it will 
     only be used by solvent companies and will not be used to 
     prevent failure of otherwise failing firms;
       (C) determine what type of collateral the Board of 
     Governors will accept against emergency lending to ensure 
     that all lending is done against good collateral;
       (D) prescribe how much that collateral will be discounted 
     in order to ensure against taxpayer losses;
       (E) address how the Board of Governors and the Secretary 
     shall ensure that the program does not allocate credit or 
     artificially prop up certain segments of the economy;
       (F) address how the Board of Governors will transfer any 
     assets associated with losses to the lending program to the 
     Secretary to ensure that losses from emergency lending do not 
     lead to inflationary pressures;
       (G) establish procedures by which the Board of Governors 
     would modify and change such rules to ensure a proper notice 
     and comment period, including publicly documenting the need 
     for the rule change; and
       (H) include any other factors that the Board of Governors 
     and the Secretary deem appropriate.
       (c) Liquidation Required.--All financial companies put into 
     receivership under this title shall be liquidated within 2 
     years of being put into receivership. No taxpayer funds may 
     be used
       (1) to provide assistance to--
       (A) a company that is in bankruptcy, in receivership under 
     title II, or in any other insolvency proceeding; or
       (B) any company that would otherwise need to be placed into 
     receivership under Federal or State laws; or
       (2) to prevent the liquidation of any financial company 
     under this title.
       (d) Recovery of Funds.--All funds expended in the 
     liquidation of a financial company under this title shall be 
     recovered from the disposition of assets of such financial 
     company.
       (e) No Losses to Taxpayers.--Taxpayers shall bear no losses 
     from the exercise of any authority under this title.
       (f) No FDIC Bailouts--Section 13(c)(4)(G) of the Federal 
     Deposit Insurance Act (12 U.S.C. 1823 (c)(4)G)) is amended--
       (1) in clause (i)--
       (A) in subclause (I), by inserting ``for which the 
     Corporation has been appointed receiver'' before ``would have 
     serious''; and
       (B) in the undesignated matter following subclause (II), by 
     inserting ``for the winding up of the insured depository 
     institution for which the Corporation has been appointed 
     receiver'' after ``provide assistance under this section''
                                 ______
                                 
  SA 3831. Mr. SHELBY submitted an amendment intended to be proposed to 
amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mrs. Lincoln)) to the bill S. 3217, to promote the financial stability 
of the United States by improving accountability and transparency in 
the financial system, to end ``too big to fail,'' to protect the 
American taxpayer by ending bailouts, to protect consumers from abusive 
financial services practices, and for other purposes; which was ordered 
to lie on the table; as follows:

       Strike title X and insert the following:

            TITLE X--BUREAU OF CONSUMER FINANCIAL PROTECTION

     SEC. 1001. SHORT TITLE.

       This title may be cited as the ``Consumer Financial 
     Protection Act of 2010''.

     SEC. 1002. DEFINITIONS.

       Except as otherwise provided in this title, for purposes of 
     this title, the following definitions shall apply:
       (1) Affiliate.--The term ``affiliate'' means any person 
     that controls, is controlled by, or is under common control 
     with another person.
       (2) Bureau.--The term ``Bureau'' means the Bureau of 
     Consumer Financial Protection.
       (3) Business of insurance.--The term ``business of 
     insurance'' means the writing of insurance or the reinsuring 
     of risks by an insurer, including all acts necessary to such 
     writing or reinsuring and the activities relating to the 
     writing of insurance or the reinsuring of risks conducted by 
     persons who act as, or are, officers, directors, agents, or 
     employees of insurers or who are other persons authorized to 
     act on behalf of such persons.
       (4) Consumer.--The term ``consumer'' means an individual or 
     an agent, trustee, or representative acting on behalf of an 
     individual.
       (5) Consumer financial product or service.--The term 
     ``consumer financial product or service'' means any financial 
     product or service that is described in one or more 
     categories under--
       (A) paragraph (13) and is offered or provided for use by 
     consumers primarily for personal, family, or household 
     purposes; or
       (B) clause (i), (iii), (ix), or (x) of paragraph (13)(A), 
     and is delivered, offered, or provided in connection with a 
     consumer financial product or service referred to in 
     subparagraph (A).
       (6) Covered person.--The term ``covered person'' means--
       (A) any person that engages in offering or providing a 
     consumer financial product or service; and
       (B) any affiliate of a person described in subparagraph (A) 
     if such affiliate acts as a service provider to such person.
       (7) Credit.--The term ``credit'' means the right granted by 
     a person to a consumer to defer payment of a debt, incur debt 
     and defer its payment, or purchase property or services and 
     defer payment for such purchase.
       (8) Deposit-taking activity.--The term ``deposit-taking 
     activity'' means--
       (A) the acceptance of deposits, maintenance of deposit 
     accounts, or the provision of services related to the 
     acceptance of deposits or the maintenance of deposit 
     accounts;
       (B) the acceptance of funds, the provision of other 
     services related to the acceptance of funds, or the 
     maintenance of member share accounts by a credit union; or
       (C) the receipt of funds or the equivalent thereof, as the 
     Bureau may determine by rule or order, received or held by a 
     covered person (or an agent for a covered person) for the 
     purpose of facilitating a payment or transferring funds or 
     value of funds between a consumer and a third party.
       (9) Designated transfer date.--The term ``designated 
     transfer date'' means the date established under section 
     1062.
       (10) Director.--The term ``Director'' means the Director of 
     the Bureau.
       (11) Enumerated consumer laws.--The term ``enumerated 
     consumer laws'' means--
       (A) the Alternative Mortgage Transaction Parity Act of 1982 
     (12 U.S.C. 3801 et seq.);
       (B) the Consumer Leasing Act of 1976 (15 U.S.C. 1667 et 
     seq.);
       (C) the Electronic Fund Transfer Act (15 U.S.C. 1693 et 
     seq.);
       (D) the Equal Credit Opportunity Act (15 U.S.C. 1691 et 
     seq.);
       (E) the Fair Credit Billing Act (15 U.S.C. 1666 et seq.);
       (F) the Fair Credit Reporting Act (15 U.S.C. 1681 et seq.), 
     except with respect to sections 615(e) and 628 of that Act 
     (15 U.S.C. 1681m(e), 1681w);
       (G) the Home Owners Protection Act of 1998 (12 U.S.C. 4901 
     et seq.);
       (H) the Fair Debt Collection Practices Act (15 U.S.C. 1692 
     et seq.);
       (I) subsections (c) through (f) of section 43 of the 
     Federal Deposit Insurance Act (12 U.S.C. 1831t(c)-(f));
       (J) sections 502 through 509 of the Gramm-Leach-Bliley Act 
     (15 U.S.C. 6802-6809);
       (K) the Home Mortgage Disclosure Act of 1975 (12 U.S.C. 
     2801 et seq.);
       (L) the Home Ownership and Equity Protection Act of 1994 
     (15 U.S.C. 1601 note);
       (M) the Real Estate Settlement Procedures Act of 1974 (12 
     U.S.C. 2601 et seq.);
       (N) the S.A.F.E. Mortgage Licensing Act of 2008 (12 U.S.C. 
     5101 et seq.);
       (O) the Truth in Lending Act (15 U.S.C. 1601 et seq.); and
       (P) the Truth in Savings Act (12 U.S.C. 4301 et seq.).
       (12) Federal consumer financial law.--The term ``Federal 
     consumer financial law'' means the provisions of this title, 
     the enumerated consumer laws, the laws for which authorities 
     are transferred under subtitles F and H, and any rule or 
     order prescribed by the Bureau under this title, an 
     enumerated consumer law, or pursuant to the authorities 
     transferred under subtitles F and H.
       (13) Financial product or service.--The term ``financial 
     product or service''--
       (A) means--
       (i) extending credit and servicing loans, including 
     acquiring, purchasing, selling,

[[Page S3229]]

     brokering, or other extensions of credit (other than solely 
     extending commercial credit to a person who originates 
     consumer credit transactions);
       (ii) extending or brokering leases of personal or real 
     property that are the functional equivalent of purchase 
     finance arrangements, if--

       (I) the lease is on a non-operating basis;
       (II) the initial term of the lease is at least 90 days; and
       (III) in the case of a lease involving real property, at 
     the inception of the initial lease, the transaction is 
     intended to result in ownership of the leased property to be 
     transferred to the lessee, subject to standards prescribed by 
     the Bureau;

       (iii) providing real estate settlement services or 
     performing appraisals of real estate or personal property;
       (iv) engaging in deposit-taking activities, transmitting or 
     exchanging funds, or otherwise acting as a custodian of funds 
     or any financial instrument for use by or on behalf of a 
     consumer;
       (v) selling, providing, or issuing stored value or payment 
     instruments, except that, in the case of a sale of, or 
     transaction to reload, stored value, only if the seller 
     exercises substantial control over the terms or conditions of 
     the stored value provided to the consumer where, for purposes 
     of this clause--

       (I) a seller shall not be found to exercise substantial 
     control over the terms or conditions of the stored value if 
     the seller is not a party to the contract with the consumer 
     for the stored value product, and another person is 
     principally responsible for establishing the terms or 
     conditions of the stored value; and
       (II) advertising the nonfinancial goods or services of the 
     seller on the stored value card or device is not in itself an 
     exercise of substantial control over the terms or conditions;

       (vi) providing check cashing, check collection, or check 
     guaranty services;
       (vii) providing payments or other financial data processing 
     products or services to a consumer by any technological 
     means, including processing or storing financial or banking 
     data for any payment instrument, or through any payments 
     systems or network used for processing payments data, 
     including payments made through an online banking system or 
     mobile telecommunications network, except that a person shall 
     not be deemed to be a covered person with respect to 
     financial data processing solely because the person--

       (I) unknowingly or incidentally processes, stores, or 
     transmits over the Internet, telephone line, mobile network, 
     or any other mode of transmission, as part of a stream of 
     other types of data, financial data in a manner that such 
     data is undifferentiated from other types of data of the same 
     form that the person processes, stores, or transmits;
       (II) is a merchant, retailer, or seller of any nonfinancial 
     good or service who engages in financial data processing by 
     transmitting or storing payments data about a consumer 
     exclusively for purpose of initiating payments instructions 
     by the consumer to pay such person for the purchase of, or to 
     complete a commercial transaction for, such nonfinancial good 
     or service sold directly by such person to the consumer; or
       (III) provides access to a host server to a person for 
     purposes of enabling that person to establish and maintain a 
     website;

       (viii) providing financial advisory services to consumers 
     on individual financial matters or relating to proprietary 
     financial products or services (other than by publishing any 
     bona fide newspaper, news magazine, or business or financial 
     publication of general and regular circulation, including 
     publishing market data, news, or data analytics or investment 
     information or recommendations that are not tailored to the 
     individual needs of a particular consumer), including--

       (I) providing credit counseling to any consumer; and
       (II) providing services to assist a consumer with debt 
     management or debt settlement, modifying the terms of any 
     extension of credit, or avoiding foreclosure;

       (ix) collecting, analyzing, maintaining, or providing 
     consumer report information or other account information, 
     including information relating to the credit history of 
     consumers, used or expected to be used in connection with any 
     decision regarding the offering or provision of a consumer 
     financial product or service, except to the extent that--

       (I) a person--

       (aa) collects, analyzes, or maintains information that 
     relates solely to the transactions between a consumer and 
     such person; or
       (bb) provides the information described in item (aa) to an 
     affiliate of such person; and

       (II) the information described in subclause (I)(aa) is not 
     used by such person or affiliate in connection with any 
     decision regarding the offering or provision of a consumer 
     financial product or service to the consumer, other than 
     credit described in section 1027(a)(2)(A);

       (x) collecting debt related to any consumer financial 
     product or service; and
       (xi) such other financial product or service as may be 
     defined by the Bureau, by regulation, for purposes of this 
     title, if the Bureau finds that such financial product or 
     service is--

       (I) entered into or conducted as a subterfuge or with a 
     purpose to evade any Federal consumer financial law; or
       (II) permissible for a bank or for a financial holding 
     company to offer or to provide under any provision of a 
     Federal law or regulation applicable to a bank or a financial 
     holding company, and has, or likely will have, a material 
     impact on consumers; and

       (B) does not include the business of insurance.
       (14) Foreign exchange.--The term ``foreign exchange'' means 
     the exchange, for compensation, of currency of the United 
     States or of a foreign government for currency of another 
     government.
       (15) Insured credit union.--The term ``insured credit 
     union'' has the same meaning as in section 101 of the Federal 
     Credit Union Act (12 U.S.C. 1752).
       (16) Payment instrument.--The term ``payment instrument'' 
     means a check, draft, warrant, money order, traveler's check, 
     electronic instrument, or other instrument, payment of funds, 
     or monetary value (other than currency).
       (17) Person.--The term ``person'' means an individual, 
     partnership, company, corporation, association (incorporated 
     or unincorporated), trust, estate, cooperative organization, 
     or other entity.
       (18) Person regulated by the commodity futures trading 
     commission.--The term ``person regulated by the Commodity 
     Futures Trading Commission'' means any person that is 
     registered, or required by statute or regulation to be 
     registered, with the Commodity Futures Trading Commission, 
     but only to the extent that the activities of such person are 
     subject to the jurisdiction of the Commodity Futures Trading 
     Commission under the Commodity Exchange Act.
       (19) Person regulated by the commission.--The term ``person 
     regulated by the Commission'' means a person who is--
       (A) a broker or dealer that is required to be registered 
     under the Securities Exchange Act of 1934;
       (B) an investment adviser that is registered under the 
     Investment Advisers Act of 1940;
       (C) an investment company that is required to be registered 
     under the Investment Company Act of 1940, and any company 
     that has elected to be regulated as a business development 
     company under that Act;
       (D) a national securities exchange that is required to be 
     registered under the Securities Exchange Act of 1934;
       (E) a transfer agent that is required to be registered 
     under the Securities Exchange Act of 1934;
       (F) a clearing corporation that is required to be 
     registered under the Securities Exchange Act of 1934;
       (G) any self-regulatory organization that is required to be 
     registered with the Commission;
       (H) any nationally recognized statistical rating 
     organization that is required to be registered with the 
     Commission;
       (I) any securities information processor that is required 
     to be registered with the Commission;
       (J) any municipal securities dealer that is required to be 
     registered with the Commission;
       (K) any other person that is required to be registered with 
     the Commission under the Securities Exchange Act of 1934; and
       (L) any employee, agent, or contractor acting on behalf of, 
     registered with, or providing services to, any person 
     described in any of subparagraphs (A) through (K), but only 
     to the extent that any person described in any of 
     subparagraphs (A) through (K), or the employee, agent, or 
     contractor of such person, acts in a regulated capacity.
       (20) Person regulated by a state insurance regulator.--The 
     term ``person regulated by a State insurance regulator'' 
     means any person that is engaged in the business of insurance 
     and subject to regulation by any State insurance regulator, 
     but only to the extent that such person acts in such 
     capacity.
       (21) Person that performs income tax preparation activities 
     for consumers.--The term ``person that performs income tax 
     preparation activities for consumers'' means--
       (A) any tax return preparer (as defined in section 
     7701(a)(36) of the Internal Revenue Code of 1986), regardless 
     of whether compensated, but only to the extent that the 
     person acts in such capacity;
       (B) any person regulated by the Secretary under section 330 
     of title 31, United States Code, but only to the extent that 
     the person acts in such capacity; and
       (C) any authorized IRS e-file Providers (as defined for 
     purposes of section 7216 of the Internal Revenue Code of 
     1986), but only to the extent that the person acts in such 
     capacity.
       (22) Prudential regulator.--The term ``prudential 
     regulator'' means--
       (A) in the case of an insured depository institution, the 
     appropriate Federal banking agency, as that term is defined 
     in section 3 of the Federal Deposit Insurance Act; and
       (B) in the case of an insured credit union, the National 
     Credit Union Administration.
       (23) Related person.--The term ``related person''--
       (A) shall apply only with respect to a covered person that 
     is not a bank holding company (as that term is defined in 
     section 2 of the Bank Holding Company Act of 1956), credit 
     union, or depository institution;
       (B) shall be deemed to mean a covered person for all 
     purposes of any provision of Federal consumer financial law; 
     and
       (C) means--
       (i) any director, officer, or employee charged with 
     managerial responsibility for,

[[Page S3230]]

     or controlling shareholder of, or agent for, such covered 
     person;
       (ii) any shareholder, consultant, joint venture partner, or 
     other person, as determined by the Bureau (by rule or on a 
     case-by-case basis) who materially participates in the 
     conduct of the affairs of such covered person; and
       (iii) any independent contractor (including any attorney, 
     appraiser, or accountant) who knowingly or recklessly 
     participates in any--

       (I) violation of any provision of law or regulation; or
       (II) breach of a fiduciary duty.

       (24) Service provider.--
       (A) In general.--The term ``service provider'' means any 
     person that provides a material service to a covered person 
     in connection with the offering or provision by such covered 
     person of a consumer financial product or service, including 
     a person that--
       (i) participates in designing, operating, or maintaining 
     the consumer financial product or service; or
       (ii) processes transactions relating to the consumer 
     financial product or service (other than unknowingly or 
     incidentally transmitting or processing financial data in a 
     manner that such data is undifferentiated from other types of 
     data of the same form as the person transmits or processes).
       (B) Exceptions.--The term ``service provider'' does not 
     include a person solely by virtue of such person offering or 
     providing to a covered person--
       (i) a support service of a type provided to businesses 
     generally or a similar ministerial service; or
       (ii) time or space for an advertisement for a consumer 
     financial product or service through print, newspaper, or 
     electronic media.
       (C) Rule of construction.--A person that is a service 
     provider shall be deemed to be a covered person to the extent 
     that such person engages in the offering or provision of its 
     own consumer financial product or service.
       (25) State.--The term ``State'' means any State, territory, 
     or possession of the United States, the District of Columbia, 
     the Commonwealth of Puerto Rico, the Commonwealth of the 
     Northern Mariana Islands, Guam, American Samoa, or the United 
     States Virgin Islands or any federally recognized Indian 
     tribe, as defined by the Secretary of the Interior under 
     section 104(a) of the Federally Recognized Indian Tribe List 
     Act of 1994 (25 U.S.C. 479a-1(a)).
       (26) Stored value.--The term ``stored value'' means funds 
     or monetary value represented in any electronic format, 
     whether or not specially encrypted, and stored or capable of 
     storage on electronic media in such a way as to be 
     retrievable and transferred electronically, and includes a 
     prepaid debit card or product, or any other similar product, 
     regardless of whether the amount of the funds or monetary 
     value may be increased or reloaded.
       (27) Transmitting or exchanging funds.--The term 
     ``transmitting or exchanging funds'' means receiving 
     currency, monetary value, or payment instruments from a 
     consumer for the purpose of exchanging or transmitting the 
     same by any means, including transmission by wire, facsimile, 
     electronic transfer, courier, the Internet, or through bill 
     payment services or through other businesses that facilitate 
     third-party transfers within the United States or to or from 
     the United States.

          Subtitle A--Bureau of Consumer Financial Protection

     SEC. 1011. ESTABLISHMENT OF THE BUREAU.

       (a) Bureau Established.--There is established in the 
     Federal Reserve System the Bureau of Consumer Financial 
     Protection, which shall regulate the offering and provision 
     of consumer financial products or services under the Federal 
     consumer financial laws.
       (b) Director and Deputy Director.--
       (1) In general.--There is established the position of the 
     Director, who shall serve as the head of the Bureau.
       (2) Appointment.--Subject to paragraph (3), the Director 
     shall be appointed by the President, by and with the advice 
     and consent of the Senate.
       (3) Qualification.--The President shall nominate the 
     Director from among individuals who are citizens of the 
     United States.
       (4) Compensation.--The Director shall be compensated at the 
     rate prescribed for level II of the Executive Schedule under 
     section 5313 of title 5, United States Code.
       (5) Deputy director.--There is established the position of 
     Deputy Director, who shall--
       (A) be appointed by the Director; and
       (B) serve as acting Director in the absence or 
     unavailability of the Director.
       (c) Term.--
       (1) In general.--The Director shall serve for a term of 5 
     years.
       (2) Expiration of term.--An individual may serve as 
     Director after the expiration of the term for which 
     appointed, until a successor has been appointed and 
     qualified.
       (3) Removal for cause.--The President may remove the 
     Director for inefficiency, neglect of duty, or malfeasance in 
     office.
       (d) Service Restriction.--No Director or Deputy Director 
     may hold any office, position, or employment in any Federal 
     reserve bank, Federal home loan bank, covered person, or 
     service provider during the period of service of such person 
     as Director or Deputy Director.
       (e) Offices.--The principal office of the Bureau shall be 
     in the District of Columbia. The Director may establish 
     regional offices of the Bureau, including in cities in which 
     the Federal reserve banks, or branches of such banks, are 
     located, in order to carry out the responsibilities assigned 
     to the Bureau under the Federal consumer financial laws.

     SEC. 1012. EXECUTIVE AND ADMINISTRATIVE POWERS.

       (a) Powers of the Bureau.--The Bureau is authorized to 
     establish the general policies of the Bureau with respect to 
     all executive and administrative functions, including--
       (1) the establishment of rules for conducting the general 
     business of the Bureau, in a manner not inconsistent with 
     this title;
       (2) to bind the Bureau and enter into contracts;
       (3) directing the establishment and maintenance of 
     divisions or other offices within the Bureau, in order to 
     carry out the responsibilities under the Federal consumer 
     financial laws, and to satisfy the requirements of other 
     applicable law;
       (4) to coordinate and oversee the operation of all 
     administrative, enforcement, and research activities of the 
     Bureau;
       (5) to adopt and use a seal;
       (6) to determine the character of and the necessity for the 
     obligations and expenditures of the Bureau;
       (7) the appointment and supervision of personnel employed 
     by the Bureau;
       (8) the distribution of business among personnel appointed 
     and supervised by the Director and among administrative units 
     of the Bureau;
       (9) the use and expenditure of funds;
       (10) implementing the Federal consumer financial laws 
     through rules, orders, guidance, interpretations, statements 
     of policy, examinations, and enforcement actions; and
       (11) performing such other functions as may be authorized 
     or required by law.
       (b) Delegation of Authority.--The Director of the Bureau 
     may delegate to any duly authorized employee, representative, 
     or agent any power vested in the Bureau by law.
       (c) Autonomy of the Bureau.--
       (1) Coordination with the board of governors.--
     Notwithstanding section 18 of the Federal Trade Commission 
     Act (15 U.S.C. 57a) and any other provision of law applicable 
     to the supervision or examination of persons with respect to 
     Federal consumer financial laws, the Board of Governors may 
     delegate to the Bureau the authorities to examine persons 
     subject to the jurisdiction of the Board of Governors for 
     compliance with the Federal consumer financial laws.
       (2) Autonomy.--Notwithstanding the authorities granted to 
     the Board of Governors under the Federal Reserve Act, the 
     Board of Governors may not--
       (A) intervene in any matter or proceeding before the 
     Director, including examinations or enforcement actions, 
     unless otherwise specifically provided by law;
       (B) appoint, direct, or remove any officer or employee of 
     the Bureau; or
       (C) merge or consolidate the Bureau, or any of the 
     functions or responsibilities of the Bureau, with any 
     division or office of the Board of Governors or the Federal 
     reserve banks.
       (3) Rules and orders.--No rule or order of the Bureau shall 
     be subject to approval or review by the Board of Governors. 
     The Board of Governors may not delay or prevent the issuance 
     of any rule or order of the Bureau.
       (4) Recommendations and testimony.--No officer or agency of 
     the United States shall have any authority to require the 
     Director or any other officer of the Bureau to submit 
     legislative recommendations, or testimony or comments on 
     legislation, to any officer or agency of the United States 
     for approval, comments, or review prior to the submission of 
     such recommendations, testimony, or comments to the Congress, 
     if such recommendations, testimony, or comments to the 
     Congress include a statement indicating that the views 
     expressed therein are those of the Director or such officer, 
     and do not necessarily reflect the views of the Board of 
     Governors or the President.

     SEC. 1013. ADMINISTRATION.

       (a) Personnel.--
       (1) Appointment.--
       (A) In general.--The Director may fix the number of, and 
     appoint and direct, all employees of the Bureau.
       (B) Employees of the bureau.--The Director is authorized to 
     employ attorneys, compliance examiners, compliance 
     supervision analysts, economists, statisticians, and other 
     employees as may be deemed necessary to conduct the business 
     of the Bureau. Notwithstanding any other provision of law, 
     all such employees shall be appointed and compensated on 
     terms and conditions that are consistent with the terms and 
     conditions set forth in section 11(l) of the Federal Reserve 
     Act (12 U.S.C. 248(l)).
       (2) Compensation.--The Director shall at all times provide 
     compensation and benefits to each class of employees that, at 
     a minimum, are equivalent to the compensation and benefits 
     then being provided by the Board of Governors for the 
     corresponding class of employees.
       (b) Specific Functional Units.--
       (1) Research.--The Director shall establish a unit whose 
     functions shall include researching, analyzing, and reporting 
     on--
       (A) developments in markets for consumer financial products 
     or services, including market areas of alternative consumer 
     financial products or services with high growth rates and 
     areas of risk to consumers;
       (B) access to fair and affordable credit for traditionally 
     underserved communities;

[[Page S3231]]

       (C) consumer awareness, understanding, and use of 
     disclosures and communications regarding consumer financial 
     products or services;
       (D) consumer awareness and understanding of costs, risks, 
     and benefits of consumer financial products or services; and
       (E) consumer behavior with respect to consumer financial 
     products or services.
       (2) Community affairs.--The Director shall establish a unit 
     whose functions shall include providing information, 
     guidance, and technical assistance regarding the offering and 
     provision of consumer financial products or services to 
     traditionally underserved consumers and communities.
       (3) Collecting and tracking complaints.--
       (A) In general.--The Director shall establish a unit whose 
     functions shall include establishing a single, toll-free 
     telephone number, a website, and a database to facilitate the 
     centralized collection of, monitoring of, and response to 
     consumer complaints regarding consumer financial products or 
     services. The Director shall coordinate with other Federal 
     agencies to route complaints to other Federal regulators, 
     where appropriate.
       (B) Routing calls to states.--To the extent practicable, 
     State agencies may receive appropriate complaints from the 
     systems established under subparagraph (A), if--
       (i) the State agency system has the functional capacity to 
     receive calls or electronic reports routed by the Bureau 
     systems; and
       (ii) the State agency has satisfied any conditions of 
     participation in the system that the Bureau may establish, 
     including treatment of personally identifiable information 
     and sharing of information on complaint resolution or related 
     compliance procedures and resources.
       (C) Reports to the congress.--The Director shall present an 
     annual report to Congress not later than March 31 of each 
     year on the complaints received by the Bureau in the prior 
     year regarding consumer financial products and services. Such 
     report shall include information and analysis about complaint 
     numbers, complaint types, and, where applicable, information 
     about resolution of complaints.
       (D) Data sharing required.--To facilitate preparation of 
     the reports required under subparagraph (C), supervision and 
     enforcement activities, and monitoring of the market for 
     consumer financial products and services, the Bureau shall 
     share consumer complaint information with prudential 
     regulators, other Federal agencies, and State agencies, 
     consistent with Federal law applicable to personally 
     identifiable information. The prudential regulators and other 
     Federal agencies shall share data relating to consumer 
     complaints regarding consumer financial products and services 
     with the Bureau, consistent with Federal law applicable to 
     personally identifiable information.
       (c) Office of Fair Lending and Equal Opportunity.--
       (1) Establishment.--The Director shall establish within the 
     Bureau the Office of Fair Lending and Equal Opportunity.
       (2) Functions.--The Office of Fair Lending and Equal 
     Opportunity shall have such powers and duties as the Director 
     may delegate to the Office, including--
       (A) providing oversight and enforcement of Federal laws 
     intended to ensure the fair, equitable, and nondiscriminatory 
     access to credit for both individuals and communities that 
     are enforced by the Bureau, including the Equal Credit 
     Opportunity Act and the Home Mortgage Disclosure Act;
       (B) coordinating fair lending and fair housing efforts of 
     the Bureau with other Federal agencies and State regulators, 
     as appropriate, to promote consistent, efficient, and 
     effective enforcement of Federal fair lending laws;
       (C) working with private industry, fair lending, civil 
     rights, consumer and community advocates on the promotion of 
     fair lending compliance and education; and
       (D) providing annual reports to Congress on the efforts of 
     the Bureau to fulfill its fair lending mandate.
       (3) Administration of office.--There is established the 
     position of Assistant Director of the Bureau for Fair Lending 
     and Equal Opportunity, who--
       (A) shall be appointed by the Director; and
       (B) shall carry out such duties as the Director may 
     delegate to such Assistant Director.
       (d) Office of Financial Literacy.--
       (1) Establishment.--The Director shall establish an Office 
     of Financial Literacy, which shall be responsible for 
     developing and implementing initiatives intended to educate 
     and empower consumers to make better informed financial 
     decisions.
       (2) Other duties.--The Office of Financial Literacy shall 
     develop and implement a strategy to improve the financial 
     literacy of consumers that includes measurable goals and 
     objectives, in consultation with the Financial Literacy and 
     Education Commission, consistent with the National Strategy 
     for Financial Education, through activities including 
     providing opportunities for consumers to access--
       (A) financial counseling;
       (B) information to assist with the evaluation of credit 
     products and the understanding of credit histories and 
     scores;
       (C) savings, borrowing, and other services found at 
     mainstream financial institutions;
       (D) activities intended to--
       (i) prepare the consumer for educational expenses and the 
     submission of financial aid applications, and other major 
     purchases;
       (ii) reduce debt; and
       (iii) improve the financial situation of the consumer;
       (E) assistance in developing long-term savings strategies; 
     and
       (F) wealth building and financial services during the 
     preparation process to claim earned income tax credits and 
     Federal benefits.
       (3) Coordination.--The Office of Financial Literacy shall 
     coordinate with other units within the Bureau in carrying out 
     its functions, including--
       (A) working with the Community Affairs Office to implement 
     the strategy to improve financial literacy of consumers; and
       (B) working with the research unit established by the 
     Director to conduct research related to consumer financial 
     education and counseling.
       (4) Report.--Not later than 24 months after the designated 
     transfer date, and annually thereafter, the Director shall 
     submit a report on its financial literacy activities and 
     strategy to improve financial literacy of consumers to--
       (A) the Committee on Banking, Housing, and Urban Affairs of 
     the Senate; and
       (B) the Committee on Financial Services of the House of 
     Representatives.
       (5) Membership in financial literacy and education 
     commission.--Section 513(c)(1) of the Financial Literacy and 
     Education Improvement Act (20 U.S.C. 9702(c)(1)) is amended--
       (A) in subparagraph (B), by striking ``and'' at the end;
       (B) by redesignating subparagraph (C) as subparagraph (D); 
     and
       (C) by inserting after subparagraph (B) the following new 
     subparagraph:
       ``(C) the Director of the Bureau of Consumer Financial 
     Protection; and''.
       (6) Conforming amendment.--Section 513(d) of the Financial 
     Literacy and Education Improvement Act (20 U.S.C. 9702(d)) is 
     amended by adding at the end the following: ``The Director of 
     the Bureau of Consumer Financial Protection shall serve as 
     the Vice Chairman.''.

     SEC. 1014. CONSUMER ADVISORY BOARD.

       (a) Establishment Required.--The Director shall establish a 
     Consumer Advisory Board to advise and consult with the Bureau 
     in the exercise of its functions under the Federal consumer 
     financial laws, and to provide information on emerging 
     practices in the consumer financial products or services 
     industry, including regional trends, concerns, and other 
     relevant information.
       (b) Membership.--In appointing the members of the Consumer 
     Advisory Board, the Director shall seek to assemble experts 
     in consumer protection, financial services, community 
     development, fair lending, and consumer financial products or 
     services and seek representation of the interests of covered 
     persons and consumers, without regard to party affiliation. 
     Not fewer than 6 members shall be appointed upon the 
     recommendation of the regional Federal Reserve Bank 
     Presidents, on a rotating basis.
       (c) Meetings.--The Consumer Advisory Board shall meet from 
     time to time at the call of the Director, but, at a minimum, 
     shall meet at least twice in each year.
       (d) Compensation and Travel Expenses.--Members of the 
     Consumer Advisory Board who are not full-time employees of 
     the United States shall--
       (1) be entitled to receive compensation at a rate fixed by 
     the Director while attending meetings of the Consumer 
     Advisory Board, including travel time; and
       (2) be allowed travel expenses, including transportation 
     and subsistence, while away from their homes or regular 
     places of business.

     SEC. 1015. COORDINATION.

       The Bureau shall coordinate with the Commission, the 
     Commodity Futures Trading Commission, and other Federal 
     agencies and State regulators, as appropriate, to promote 
     consistent regulatory treatment of consumer financial and 
     investment products and services.

     SEC. 1016. APPEARANCES BEFORE AND REPORTS TO CONGRESS.

       (a) Appearances Before Congress.--The Director of the 
     Bureau shall appear before the Committee on Banking, Housing, 
     and Urban Affairs of the Senate and the Committee on 
     Financial Services of the House of Representatives at semi-
     annual hearings regarding the reports required under 
     subsection (b).
       (b) Reports Required.--The Bureau shall, concurrent with 
     each semi-annual hearing referred to in subsection (a), 
     prepare and submit to the President and to the Committee on 
     Banking, Housing, and Urban Affairs of the Senate and the 
     Committee on Financial Services of the House of 
     Representatives, a report, beginning with the session 
     following the designated transfer date.
       (c) Contents.--The reports required by subsection (b) shall 
     include--
       (1) a discussion of the significant problems faced by 
     consumers in shopping for or obtaining consumer financial 
     products or services;
       (2) a justification of the budget request of the previous 
     year;
       (3) a list of the significant rules and orders adopted by 
     the Bureau, as well as other significant initiatives 
     conducted by the Bureau, during the preceding year and the 
     plan of the Bureau for rules, orders, or other initiatives to 
     be undertaken during the upcoming period;

[[Page S3232]]

       (4) an analysis of complaints about consumer financial 
     products or services that the Bureau has received and 
     collected in its central database on complaints during the 
     preceding year;
       (5) a list, with a brief statement of the issues, of the 
     public supervisory and enforcement actions to which the 
     Bureau was a party during the preceding year;
       (6) the actions taken regarding rules, orders, and 
     supervisory actions with respect to covered persons which are 
     not credit unions or depository institutions;
       (7) an assessment of significant actions by State attorneys 
     general or State regulators relating to Federal consumer 
     financial law; and
       (8) an analysis of the efforts of the Bureau to fulfill the 
     fair lending mission of the Bureau.

     SEC. 1017. FUNDING; PENALTIES AND FINES.

       (a) Transfer of Funds From Board of Governors.--
       (1) In general.--Each year (or quarter of such year), 
     beginning on the designated transfer date, and each quarter 
     thereafter, the Board of Governors shall transfer to the 
     Bureau from the combined earnings of the Federal Reserve 
     System, the amount determined by the Director to be 
     reasonably necessary to carry out the authorities of the 
     Bureau under Federal consumer financial law, taking into 
     account such other sums made available to the Bureau from the 
     preceding year (or quarter of such year).
       (2) Funding cap.--
       (A) In general.--Notwithstanding paragraph (1), and in 
     accordance with this paragraph, the amount that shall be 
     transferred to the Bureau in each fiscal year shall not 
     exceed a fixed percentage of the total operating expenses of 
     the Federal Reserve System, as reported in the Annual Report, 
     2009, of the Board of Governors, equal to--
       (i) 10 percent of such expenses in fiscal year 2011;
       (ii) 11 percent of such expenses in fiscal year 2012; and
       (iii) 12 percent of such expenses in fiscal year 2013, and 
     in each year thereafter.
       (B) Amount adjusted for inflation.--The dollar amount 
     referred to in subparagraph (A)(iii) shall be adjusted 
     annually, using the percent by which the average urban 
     consumer price index for the quarter preceding the date of 
     the payment differs from the average of that index for the 
     same quarter in the prior year.
       (3) Transition period.--Beginning on the date of enactment 
     of this Act and until the designated transfer date, the Board 
     of Governors shall transfer to the Bureau the amount 
     estimated by the Secretary needed to carry out the 
     authorities granted to the Bureau under Federal consumer 
     financial law, from the date of enactment of this Act until 
     the designated transfer date.
       (4) Budget and financial management.--
       (A) Financial operating plans and forecasts.--The Director 
     shall provide to the Director of the Office of Management and 
     Budget copies of the financial operating plans and forecasts 
     of the Director, as prepared by the Director in the ordinary 
     course of the operations of the Bureau, and copies of the 
     quarterly reports of the financial condition and results of 
     operations of the Bureau, as prepared by the Director in the 
     ordinary course of the operations of the Bureau.
       (B) Financial statements.--The Bureau shall prepare 
     annually a statement of--
       (i) assets and liabilities and surplus or deficit;
       (ii) income and expenses; and
       (iii) sources and application of funds.
       (C) Financial management systems.--The Bureau shall 
     implement and maintain financial management systems that 
     comply substantially with Federal financial management 
     systems requirements and applicable Federal accounting 
     standards.
       (D) Assertion of internal controls.--The Director shall 
     provide to the Comptroller General of the United States an 
     assertion as to the effectiveness of the internal controls 
     that apply to financial reporting by the Bureau, using the 
     standards established in section 3512(c) of title 31, United 
     States Code.
       (E) Rule of construction.--This subsection may not be 
     construed as implying any obligation on the part of the 
     Director to consult with or obtain the consent or approval of 
     the Director of the Office of Management and Budget with 
     respect to any report, plan, forecast, or other information 
     referred to in subparagraph (A) or any jurisdiction or 
     oversight over the affairs or operations of the Bureau.
       (5) Audit of the bureau.--
       (A) In general.--The Comptroller General shall annually 
     audit the financial transactions of the Bureau in accordance 
     with the United States generally accepted government auditing 
     standards, as may be prescribed by the Comptroller General of 
     the United States. The audit shall be conducted at the place 
     or places where accounts of the Bureau are normally kept. The 
     representatives of the Government Accountability Office shall 
     have access to the personnel and to all books, accounts, 
     documents, papers, records (including electronic records), 
     reports, files, and all other papers, automated data, things, 
     or property belonging to or under the control of or used or 
     employed by the Bureau pertaining to its financial 
     transactions and necessary to facilitate the audit, and such 
     representatives shall be afforded full facilities for 
     verifying transactions with the balances or securities held 
     by depositories, fiscal agents, and custodians. All such 
     books, accounts, documents, records, reports, files, papers, 
     and property of the Bureau shall remain in possession and 
     custody of the Bureau. The Comptroller General may obtain and 
     duplicate any such books, accounts, documents, records, 
     working papers, automated data and files, or other 
     information relevant to such audit without cost to the 
     Comptroller General, and the right of access of the 
     Comptroller General to such information shall be enforceable 
     pursuant to section 716(c) of title 31, United States Code.
       (B) Report.--The Comptroller General shall submit to the 
     Congress a report of each annual audit conducted under this 
     subsection. The report to the Congress shall set forth the 
     scope of the audit and shall include the statement of assets 
     and liabilities and surplus or deficit, the statement of 
     income and expenses, the statement of sources and application 
     of funds, and such comments and information as may be deemed 
     necessary to inform Congress of the financial operations and 
     condition of the Bureau, together with such recommendations 
     with respect thereto as the Comptroller General may deem 
     advisable. A copy of each report shall be furnished to the 
     President and to the Bureau at the time submitted to the 
     Congress.
       (C) Assistance and costs.--For the purpose of conducting an 
     audit under this subsection, the Comptroller General may, in 
     the discretion of the Comptroller General, employ by 
     contract, without regard to section 3709 of the Revised 
     Statutes of the United States (41 U.S.C. 5), professional 
     services of firms and organizations of certified public 
     accountants for temporary periods or for special purposes. 
     Upon the request of the Comptroller General, the Director of 
     the Bureau shall transfer to the Government Accountability 
     Office from funds available, the amount requested by the 
     Comptroller General to cover the full costs of any audit and 
     report conducted by the Comptroller General. The Comptroller 
     General shall credit funds transferred to the account 
     established for salaries and expenses of the Government 
     Accountability Office, and such amount shall be available 
     upon receipt and without fiscal year limitation to cover the 
     full costs of the audit and report.
       (b) Consumer Financial Protection Fund.--
       (1) Separate fund in federal reserve board established.--
     There is established in the Federal Reserve Board a separate 
     fund, to be known as the ``Consumer Financial Protection 
     Fund'' (referred to in this section as the ``Bureau Fund'').
       (2) Fund receipts.--All amounts transferred to the Bureau 
     under subsection (a) shall be deposited into the Bureau Fund.
       (3) Investment authority.--
       (A) Amounts in bureau fund may be invested.--The Bureau may 
     request the Board of Governors to invest the portion of the 
     Bureau Fund that is not, in the judgment of the Bureau, 
     required to meet the current needs of the Bureau.
       (B) Eligible investments.--Investments authorized by this 
     paragraph shall be made by the Board of Governors in 
     obligations of the United States or obligations that are 
     guaranteed as to principal and interest by the United States, 
     with maturities suitable to the needs of the Bureau Fund, as 
     determined by the Bureau.
       (C) Interest and proceeds credited.--The interest on, and 
     the proceeds from the sale or redemption of, any obligations 
     held in the Bureau Fund shall be credited to the Bureau Fund.
       (c) Use of Funds.--
       (1) In general.--Funds obtained by, transferred to, or 
     credited to the Bureau Fund shall be immediately available to 
     the Bureau and under the control of the Director, and shall 
     remain available until expended, to pay the expenses of the 
     Bureau in carrying out its duties and responsibilities. The 
     compensation of the Director and other employees of the 
     Bureau and all other expenses thereof may be paid from, 
     obtained by, transferred to, or credited to the Bureau Fund 
     under this section.
       (2) Funds that are not government funds.--Funds obtained by 
     or transferred to the Bureau Fund shall not be construed to 
     be Government funds or appropriated monies.
       (3) Amounts not subject to apportionment.--Notwithstanding 
     any other provision of law, amounts in the Bureau Fund and in 
     the Civil Penalty Fund established under subsection (d) shall 
     not be subject to apportionment for purposes of chapter 15 of 
     title 31, United States Code, or under any other authority.
       (d) Penalties and Fines.--
       (1) Establishment of victims relief fund.--There is 
     established in the Federal Reserve Board a fund to be known 
     as the ``Consumer Financial Protection Civil Penalty Fund'' 
     (referred to in this subsection as the ``Civil Penalty 
     Fund''). If the Bureau obtains a civil penalty against any 
     person in any judicial or administrative action under Federal 
     consumer financial laws, the Bureau shall deposit into the 
     Civil Penalty Fund, the amount of the penalty collected.
       (2) Payment to victims.--Amounts in the Civil Penalty Fund 
     shall be available to the Bureau, without fiscal year 
     limitation, for payments to the victims of activities for 
     which civil penalties have been imposed under the Federal 
     consumer financial laws. To the extent such victims cannot be 
     located or such payments are otherwise not practicable, the 
     Bureau may use such funds for the purpose of consumer 
     education and financial literacy programs.

[[Page S3233]]

     SEC. 1018. EFFECTIVE DATE.

       This subtitle shall become effective on the date of 
     enactment of this Act.

                Subtitle B--General Powers of the Bureau

     SEC. 1021. PURPOSE, OBJECTIVES, AND FUNCTIONS.

       (a) Purpose.--The Bureau shall seek to implement and, where 
     applicable, enforce Federal consumer financial law 
     consistently for the purpose of ensuring that markets for 
     consumer financial products and services are fair, 
     transparent, and competitive.
       (b) Objectives.--The Bureau is authorized to exercise its 
     authorities under Federal consumer financial law for the 
     purposes of ensuring that, with respect to consumer financial 
     products and services--
       (1) consumers are provided with timely and understandable 
     information to make responsible decisions about financial 
     transactions;
       (2) consumers are protected from unfair, deceptive, or 
     abusive acts and practices and from discrimination;
       (3) outdated, unnecessary, or unduly burdensome regulations 
     are regularly identified and addressed in order to reduce 
     unwarranted regulatory burdens;
       (4) Federal consumer financial law is enforced 
     consistently, without regard to the status of a person as a 
     depository institution, in order to promote fair competition; 
     and
       (5) markets for consumer financial products and services 
     operate transparently and efficiently to facilitate access 
     and innovation.
       (c) Functions.--The primary functions of the Bureau are--
       (1) conducting financial education programs;
       (2) collecting, investigating, and responding to consumer 
     complaints;
       (3) collecting, researching, monitoring, and publishing 
     information relevant to the functioning of markets for 
     consumer financial products and services to identify risks to 
     consumers and the proper functioning of such markets;
       (4) subject to sections 1024 through 1026, supervising 
     covered persons for compliance with Federal consumer 
     financial law, and taking appropriate enforcement action to 
     address violations of Federal consumer financial law;
       (5) issuing rules, orders, and guidance implementing 
     Federal consumer financial law; and
       (6) performing such support activities as may be necessary 
     or useful to facilitate the other functions of the Bureau.

     SEC. 1022. RULEMAKING AUTHORITY.

       (a) In General.--The Bureau is authorized to exercise its 
     authorities under Federal consumer financial law to 
     administer, enforce, and otherwise implement the provisions 
     of Federal consumer financial law.
       (b) Rulemaking, Orders, and Guidance.--
       (1) General authority.--The Director may prescribe rules 
     and issue orders and guidance, as may be necessary or 
     appropriate to enable the Bureau to administer and carry out 
     the purposes and objectives of the Federal consumer financial 
     laws, and to prevent evasions thereof.
       (2) Standards for rulemaking.--In prescribing a rule under 
     the Federal consumer financial laws--
       (A) the Bureau shall consider the potential benefits and 
     costs to consumers and covered persons, including the 
     potential reduction of access by consumers to consumer 
     financial products or services resulting from such rule;
       (B) the Bureau shall consult with the appropriate 
     prudential regulators or other Federal agencies prior to 
     proposing a rule and during the comment process regarding 
     consistency with prudential, market, or systemic objectives 
     administered by such agencies; and
       (C) if, during the consultation process described in 
     subparagraph (B), a prudential regulator provides the Bureau 
     with a written objection to the proposed rule of the Bureau 
     or a portion thereof, the Bureau shall include in the 
     adopting release a description of the objection and the basis 
     for the Bureau decision, if any, regarding such objection, 
     except that nothing in this clause shall be construed as 
     altering or limiting the procedures under section 1023 that 
     may apply to any rule prescribed by the Bureau.
       (3) Exemptions.--
       (A) In general.--The Bureau, by rule, may conditionally or 
     unconditionally exempt any class of covered persons, service 
     providers, or consumer financial products or services, from 
     any provision of this title, or from any rule issued under 
     this title, as the Bureau determines necessary or appropriate 
     to carry out the purposes and objectives of this title, 
     taking into consideration the factors in subparagraph (B).
       (B) Factors.--In issuing an exemption, as permitted under 
     subparagraph (A), the Bureau shall, as appropriate, take into 
     consideration--
       (i) the total assets of the class of covered persons;
       (ii) the volume of transactions involving consumer 
     financial products or services in which the class of covered 
     persons engages; and
       (iii) existing provisions of law which are applicable to 
     the consumer financial product or service and the extent to 
     which such provisions provide consumers with adequate 
     protections.
       (4) Exclusive rulemaking authority.--Notwithstanding any 
     other provisions of Federal law, to the extent that a 
     provision of Federal consumer financial law authorizes the 
     Bureau and another Federal agency to issue regulations under 
     that provision of law for purposes of assuring compliance 
     with Federal consumer financial law and any regulations 
     thereunder, the Bureau shall have the exclusive authority to 
     prescribe rules subject to those provisions of law.
       (c) Monitoring.--
       (1) In general.--In order to support its rulemaking and 
     other functions, the Bureau shall monitor for risks to 
     consumers in the offering or provision of consumer financial 
     products or services, including developments in markets for 
     such products or services.
       (2) Considerations.--In allocating its resources to perform 
     the monitoring required by this section, the Bureau may 
     consider, among other factors--
       (A) likely risks and costs to consumers associated with 
     buying or using a type of consumer financial product or 
     service;
       (B) understanding by consumers of the risks of a type of 
     consumer financial product or service;
       (C) the legal protections applicable to the offering or 
     provision of a consumer financial product or service, 
     including the extent to which the law is likely to adequately 
     protect consumers;
       (D) rates of growth in the offering or provision of a 
     consumer financial product or service;
       (E) the extent, if any, to which the risks of a consumer 
     financial product or service may disproportionately affect 
     traditionally underserved consumers; or
       (F) the types, number, and other pertinent characteristics 
     of covered persons that offer or provide the consumer 
     financial product or service.
       (3) Reports.--The Bureau shall publish not fewer than 1 
     report of significant findings of its monitoring required by 
     this subsection in each calendar year, beginning with the 
     first calendar year that begins at least 1 year after the 
     designated transfer date.
       (4) Confidentiality rules.--The Bureau shall prescribe 
     rules regarding the confidential treatment of information 
     obtained from persons in connection with the exercise of its 
     authorities under Federal consumer financial law.
       (A) Access by the bureau to reports of other regulators.--
       (i) Examination and financial condition reports.--Upon 
     providing reasonable assurances of confidentiality, the 
     Bureau shall have access to any report of examination or 
     financial condition made by a prudential regulator or other 
     Federal agency having jurisdiction over a covered person or 
     service provider, and to all revisions made to any such 
     report.
       (ii) Provision of other reports to the bureau.--In addition 
     to the reports described in clause (i), a prudential 
     regulator or other Federal agency having jurisdiction over a 
     covered person or service provider may, in its discretion, 
     furnish to the Bureau any other report or other confidential 
     supervisory information concerning any insured depository 
     institution, credit union, or other entity examined by such 
     agency under authority of any provision of Federal law.
       (B) Access by other regulators to reports of the bureau.--
       (i) Examination reports.--Upon providing reasonable 
     assurances of confidentiality, a prudential regulator, a 
     State regulator, or any other Federal agency having 
     jurisdiction over a covered person or service provider shall 
     have access to any report of examination made by the Bureau 
     with respect to such person, and to all revisions made to any 
     such report.
       (ii) Provision of other reports to other regulators.--In 
     addition to the reports described in clause (i), the Bureau 
     may, in its discretion, furnish to a prudential regulator or 
     other agency having jurisdiction over a covered person or 
     service provider any other report or other confidential 
     supervisory information concerning such person examined by 
     the Bureau under the authority of any other provision of 
     Federal law.
       (5) Privacy considerations.--In collecting information from 
     any person, publicly releasing information held by the 
     Bureau, or requiring covered persons to publicly report 
     information, the Bureau shall take steps to ensure that 
     proprietary, personal, or confidential consumer information 
     that is protected from public disclosure under section 552(b) 
     or 552a of title 5, United States Code, or any other 
     provision of law, is not made public under this title.
       (d) Assessment of Significant Rules.--
       (1) In general.--The Bureau shall conduct an assessment of 
     each significant rule or order adopted by the Bureau under 
     Federal consumer financial law. The assessment shall address, 
     among other relevant factors, the effectiveness of the rule 
     or order in meeting the purposes and objectives of this title 
     and the specific goals stated by the Bureau. The assessment 
     shall reflect available evidence and any data that the Bureau 
     reasonably may collect.
       (2) Reports.--The Bureau shall publish a report of its 
     assessment under this subsection not later than 5 years after 
     the effective date of the subject rule or order.
       (3) Public comment required.--Before publishing a report of 
     its assessment, the Bureau shall invite public comment on 
     recommendations for modifying, expanding, or eliminating the 
     newly adopted significant rule or order.

[[Page S3234]]

     SEC. 1023. REVIEW OF BUREAU REGULATIONS.

       (a) Review of Bureau Regulations.--On the petition of a 
     member agency of the Council, the Council may set aside a 
     final regulation prescribed by the Bureau, or any provision 
     thereof, if the Council decides, in accordance with 
     subsection (c), that the regulation or provision would put 
     the safety and soundness of the United States banking system 
     or the stability of the financial system of the United States 
     at risk.
       (b) Petition.--
       (1) Procedure.--An agency represented by a member of the 
     Council may petition the Council, in writing, and in 
     accordance with rules prescribed pursuant to subsection (f), 
     to stay the effectiveness of, or set aside, a regulation if 
     the member agency filing the petition--
       (A) has in good faith attempted to work with the Bureau to 
     resolve concerns regarding the effect of the rule on the 
     safety and soundness of the United States banking system or 
     the stability of the financial system of the United States; 
     and
       (B) files the petition with the Council not later than 10 
     days after the date on which the regulation has been
       (C) published in the Federal Register.
       (2) Publication.--Any petition filed with the Council under 
     this section shall be published in the Federal Register and 
     transmitted contemporaneously with filing to the Committee on 
     Banking, Housing, and Urban Affairs of the Senate and the 
     Committee on Financial Services of the House of 
     Representatives.
       (c) Stays and Set Asides.--
       (1) Stay.--
       (A) In general.--Upon the request of any member agency, the 
     Chairperson of the Council may stay the effectiveness of a 
     regulation for the purpose of allowing appropriate 
     consideration of the petition by the Council.
       (B) Expiration.--A stay issued under this paragraph shall 
     expire on the earlier of--
       (i) 90 days after the date of filing of the petition under 
     subsection (b); or
       (ii) the date on which the Council makes a decision under 
     paragraph (3).
       (2) No adverse inference.--After the expiration of any stay 
     imposed under this section, no inference shall be drawn 
     regarding the validity or enforceability of a regulation 
     which was the subject of the petition.
       (3) Vote.--
       (A) In general.--The decision to issue a stay of, or set 
     aside, any regulation under this section shall be made only 
     with the affirmative vote in accordance with subparagraph (B) 
     of \2/3\ of the members of the Council then serving.
       (B) Authorization to vote.--A member of the Council may 
     vote to stay the effectiveness of, or set aside, a final 
     regulation prescribed by the Bureau only if the agency or 
     department represented by that member has--
       (i) considered any relevant information provided by the 
     agency submitting the petition and by the Bureau; and
       (ii) made an official determination, at a public meeting 
     where applicable, that the regulation which is the subject of 
     the petition would put the safety and soundness of the United 
     States banking system or the stability of the financial 
     system of the United States at risk.
       (4) Decisions to set aside.--
       (A) Effect of decision.--A decision by the Council to set 
     aside a regulation prescribed by the Bureau, or provision 
     thereof, shall render such regulation, or provision thereof, 
     unenforceable.
       (B) Timely action required.--The Council may not issue a 
     decision to set aside a regulation, or provision thereof, 
     which is the subject of a petition under this section after 
     the expiration of the later of--
       (i) 45 days following the date of filing of the petition, 
     unless a stay is issued under paragraph (1); or
       (ii) the expiration of a stay issued by the Council under 
     this section.
       (C) Separate authority.--The issuance of a stay under this 
     section does not affect the authority of the Council to set 
     aside a regulation.
       (5) Dismissal due to inaction.--A petition under this 
     section shall be deemed dismissed if the Council has not 
     issued a decision to set aside a regulation, or provision 
     thereof, within the period for timely action under paragraph 
     (4)(B).
       (6) Publication of decision.--Any decision under this 
     subsection to issue a stay of, or set aside, a regulation or 
     provision thereof shall be published by the Council in the 
     Federal Register as soon as practicable after the decision is 
     made, with an explanation of the reasons for the decision.
       (7) Rulemaking procedures inapplicable.--The notice and 
     comment procedures under section 553 of title 5, United 
     States Code, shall not apply to any decision under this 
     section of the Council to issue a stay of, or set aside, a 
     regulation.
       (8) Judicial review of decisions by the council.--A 
     decision by the Council to set aside a regulation prescribed 
     by the Bureau, or provision thereof, shall be subject to 
     review under chapter 7 of title 5, United States Code.
       (d) Application of Other Law.--Nothing in this section 
     shall be construed as altering, limiting, or restricting the 
     application of any other provision of law, except as 
     otherwise specifically provided in this section, including 
     chapter 5 and chapter 7 of title 5, United States Code, to a 
     regulation which is the subject of a petition filed under 
     this section.
       (e) Savings Clause.--Nothing in this section shall be 
     construed as limiting or restricting the Bureau from engaging 
     in a rulemaking in accordance with applicable law.
       (f) Implementing Rules.--The Council shall prescribe 
     procedural rules to implement this section.

     SEC. 1024. SUPERVISION OF NONDEPOSITORY COVERED PERSONS.

       (a) Scope of Coverage.--
       (1) Applicability.--Notwithstanding any other provision of 
     this title, and except as provided in paragraph (3), this 
     section shall apply to any covered person who--
       (A) offers or provides origination, brokerage, or servicing 
     of loans secured by real estate for use by consumers 
     primarily for personal, family, or household purposes, or 
     loan modification or foreclosure relief services in 
     connection with such loans; or
       (B) is a larger participant of a market for other consumer 
     financial products or services, as defined by rule in 
     accordance with paragraph (2).
       (2) Rulemaking to define covered persons subject to this 
     section.--The Bureau shall consult with the Federal Trade 
     Commission prior to issuing a rule to define covered persons 
     subject to this section, in accordance with paragraph (1)(B). 
     The Bureau shall issue its initial rule within 1 year of the 
     designated transfer date.
       (3) Rules of construction.--
       (A) Certain persons excluded.--This section shall not apply 
     to persons described in section 1025(a) or 1026(a).
       (B) Activity levels.--For purposes of computing activity 
     levels under paragraph (1) or rules issued thereunder, 
     activities of affiliated companies (other than insured 
     depository institutions or insured credit unions) shall be 
     aggregated.
       (b) Supervision.--
       (1) In general.--The Bureau shall require reports and 
     conduct examinations on a periodic basis of persons described 
     in subsection (a) for purposes of--
       (A) assessing compliance with the requirements of Federal 
     consumer financial law;
       (B) obtaining information about the activities and 
     compliance systems or procedures of such person; and
       (C) detecting and assessing risks to consumers and to 
     markets for consumer financial products and services.
       (2) Risk-based supervision program.--The Bureau shall 
     exercise its authority under paragraph (1) in a manner 
     designed to ensure that such exercise, with respect to 
     persons described in subsection (a), is based on the 
     assessment by the Bureau of the risks posed to consumers in 
     the relevant product markets and geographic markets, and 
     taking into consideration, as applicable--
       (A) the asset size of the covered person;
       (B) the volume of transactions involving consumer financial 
     products or services in which the covered person engages;
       (C) the risks to consumers created by the provision of such 
     consumer financial products or services;
       (D) the extent to which such institutions are subject to 
     oversight by State authorities for consumer protection; and
       (E) any other factors that the Bureau determines to be 
     relevant to a class of covered persons.
       (3) Coordination.--To minimize regulatory burden, the 
     Bureau shall coordinate its supervisory activities with the 
     supervisory activities conducted by prudential regulators and 
     the State bank regulatory authorities, including establishing 
     their respective schedules for examining persons described in 
     subsection (a) and requirements regarding reports to be 
     submitted by such persons.
       (4) Use of existing reports.--The Bureau shall, to the 
     fullest extent possible, use--
       (A) reports pertaining to persons described in subsection 
     (a) that have been provided or required to have been provided 
     to a Federal or State agency; and
       (B) information that has been reported publicly.
       (5) Preservation of authority.--Nothing in this title may 
     be construed as limiting the authority of the Director to 
     require reports from persons described in subsection (a), as 
     permitted under paragraph (1), regarding information owned or 
     under the control of such person, regardless of whether such 
     information is maintained, stored, or processed by another 
     person.
       (6) Reports of tax law noncompliance.--The Bureau shall 
     provide the Commissioner of Internal Revenue with any report 
     of examination or related information identifying possible 
     tax law noncompliance.
       (7) Registration, recordkeeping, and other requirements for 
     certain persons.--
       (A) In general.--The Bureau shall prescribe rules to 
     facilitate supervision of persons described in subsection (a) 
     and assessment and detection of risks to consumers.
       (B) Registration.--
       (i) In general.--The Bureau shall prescribe rules regarding 
     registration requirements for persons described in subsection 
     (a).
       (ii) Exception for related persons.--The Bureau may not 
     impose requirements under this section regarding the 
     registration of a related person.
       (iii) Registration information.--Subject to rules 
     prescribed by the Bureau, the Bureau shall publicly disclose 
     the registration information about persons described in 
     subsection (a) to facilitate the ability of consumers to 
     identify persons described in subsection (a) registered with 
     the Bureau.
       (C) Recordkeeping.--The Bureau may require a person 
     described in subsection (a), to

[[Page S3235]]

     generate, provide, or retain records for the purposes of 
     facilitating supervision of such persons and assessing and 
     detecting risks to consumers.
       (D) Requirements concerning obligations.--The Bureau may 
     prescribe rules regarding a person described in subsection 
     (a), to ensure that such persons are legitimate entities and 
     are able to perform their obligations to consumers. Such 
     requirements may include background checks for principals, 
     officers, directors, or key personnel and bonding or other 
     appropriate financial requirements.
       (E) Consultation with state agencies.--In developing and 
     implementing requirements under this paragraph, the Bureau 
     shall consult with State agencies regarding requirements or 
     systems (including coordinated or combined systems for 
     registration), where appropriate.
       (c) Exclusive Enforcement Authority.--
       (1) The bureau to have exclusive enforcement authority.--To 
     the extent that Federal law authorizes the Bureau and another 
     Federal agency to enforce Federal consumer financial law, the 
     Bureau shall have exclusive authority to enforce that Federal 
     consumer financial law with respect to any person described 
     in subsection (a)(1)(B).
       (2) Referral.--Any Federal agency authorized to enforce a 
     Federal consumer financial law described in paragraph (1) may 
     recommend in writing to the Bureau that the Bureau initiate 
     an enforcement proceeding, as the Bureau is authorized by 
     that Federal law or by this title.
       (3) Coordination with the federal trade commission.--
       (A) In general.--The Bureau and the Federal Trade 
     Commission shall coordinate enforcement actions for 
     violations of Federal law regarding the offering or provision 
     of consumer financial products or services by any covered 
     person that is described in subsection (a)(1)(A), or service 
     providers thereto. In carrying out this subparagraph, the 
     agencies shall negotiate an agreement to establish procedures 
     for such coordination, including procedures for notice to the 
     other agency, where feasible, prior to initiating a civil 
     action to enforce a Federal law regarding the offering or 
     provision of consumer financial products or services.
       (B) Civil actions.--Whenever a civil action has been filed 
     by, or on behalf of, the Bureau or the Federal Trade 
     Commission for any violation of any provision of Federal law 
     described in subparagraph (A), or any regulation prescribed 
     under such provision of law--
       (i) the other agency may not, during the pendency of that 
     action, institute a civil action under such provision of law 
     against any defendant named in the complaint in such pending 
     action for any violation alleged in the complaint; and
       (ii) the Bureau or the Federal Trade Commission may 
     intervene as a party in any such action brought by the other 
     agency, and, upon intervening--

       (I) be heard on all matters arising in such enforcement 
     action; and
       (II) file petitions for appeal in such actions.

       (C) Agreement terms.--The terms of any agreement negotiated 
     under subparagraph (A) may modify or supersede the provisions 
     of subparagraph (B).
       (D) Deadline.--The agencies shall reach the agreement 
     required under subparagraph (A) not later than 6 months after 
     the designated transfer date.
       (d) Exclusive Rulemaking and Examination Authority.--
     Notwithstanding any other provision of Federal law, to the 
     extent that Federal law authorizes the Bureau and another 
     Federal agency to issue regulations or guidance, conduct 
     examinations, or require reports from a person described in 
     subsection (a) under such law for purposes of assuring 
     compliance with Federal consumer financial law and any 
     regulations thereunder, the Bureau shall have the exclusive 
     authority to prescribe rules, issue guidance, conduct 
     examinations, require reports, or issue exemptions with 
     regard to a person described in subsection (a), subject to 
     those provisions of law.
       (e) Service Providers.--A service provider to a person 
     described in subsection (a) shall be subject to the authority 
     of the Bureau under this section, to the same extent as if 
     such service provider were engaged in a service relationship 
     with a bank, and the Bureau were an appropriate Federal 
     banking agency under section 7(c) of the Bank Service Company 
     Act (12 U.S.C. 1867(c)). In conducting any examination or 
     requiring any report from a service provider subject to this 
     subsection, the Bureau shall coordinate with the appropriate 
     prudential regulator, as applicable.
       (f) Preservation of Farm Credit Administration Authority.--
     No provision of this title may be construed as modifying, 
     limiting, or otherwise affecting the authority of the Farm 
     Credit Administration.

     SEC. 1025. SUPERVISION OF VERY LARGE BANKS, SAVINGS 
                   ASSOCIATIONS, AND CREDIT UNIONS.

       (a) Scope of Coverage.--
       (1) Applicability.--This section shall apply to any covered 
     person that is--
       (A) an insured depository institution with total assets of 
     more than $10,000,000,000 and any affiliate thereof; or
       (B) an insured credit union with total assets of more than 
     $10,000,000,000 and any affiliate thereof.
       (2) Rule of construction.--For purposes of determining 
     total assets under this section and section 1026, the Bureau 
     shall rely on the same regulations and interim methodologies 
     specified in section 312(e).
       (b) Supervision.--
       (1) In general.--The Bureau shall require reports and 
     conduct examinations on a periodic basis of persons described 
     in subsection (a) for purposes of--
       (A) assessing compliance with the requirements of Federal 
     consumer financial laws;
       (B) obtaining information about the activities and 
     compliance systems or procedures of such persons; and
       (C) detecting and assessing risks to consumers and to 
     markets for consumer financial products and services.
       (2) Coordination.--To minimize regulatory burden, the 
     Bureau shall coordinate its supervisory activities with the 
     supervisory activities conducted by prudential regulators and 
     the State bank regulatory authorities, including establishing 
     their respective schedules for examining such persons 
     described in subsection (a) and requirements regarding 
     reports to be submitted by such persons.
       (3) Use of existing reports.--The Bureau shall, to the 
     fullest extent possible, use--
       (A) reports pertaining to a person described in subsection 
     (a) that have been provided or required to have been provided 
     to a Federal or State agency; and
       (B) information that has been reported publicly.
       (4) Preservation of authority.--Nothing in this title may 
     be construed as limiting the authority of the Director to 
     require reports from a person described in subsection (a), as 
     permitted under paragraph (1), regarding information owned or 
     under the control of such person, regardless of whether such 
     information is maintained, stored, or processed by another 
     person.
       (5) Reports of tax law noncompliance.--The Bureau shall 
     provide the Commissioner of Internal Revenue with any report 
     of examination or related information identifying possible 
     tax law noncompliance.
       (c) Primary Enforcement Authority.--
       (1) The bureau to have primary enforcement authority.--To 
     the extent that the Bureau and another Federal agency are 
     authorized to enforce a Federal consumer financial law, the 
     Bureau shall have primary authority to enforce that Federal 
     consumer financial law with respect to any person described 
     in subsection (a).
       (2) Referral.--Any Federal agency, other than the Federal 
     Trade Commission, that is authorized to enforce a Federal 
     consumer financial law may recommend, in writing, to the 
     Bureau that the Bureau initiate an enforcement proceeding 
     with respect to a person described in subsection (a), as the 
     Bureau is authorized to do by that Federal consumer financial 
     law.
       (3) Backup enforcement authority of other federal agency.--
     If the Bureau does not, before the end of the 120-day period 
     beginning on the date on which the Bureau receives a 
     recommendation under paragraph (2), initiate an enforcement 
     proceeding, the other agency referred to in paragraph (2) may 
     initiate an enforcement proceeding, as permitted by the 
     subject provision of Federal law.
       (d) Service Providers.--A service provider to a person 
     described in subsection (a) shall be subject to the authority 
     of the Bureau under this section, to the same extent as if 
     the Bureau were an appropriate Federal banking agency under 
     section 7(c) of the Bank Service Company Act 12 U.S.C. 
     1867(c). In conducting any examination or requiring any 
     report from a service provider subject to this subsection, 
     the Bureau shall coordinate with the appropriate prudential 
     regulator.
       (e) Simultaneous and Coordinated Supervisory Action.--
       (1) Examinations.--A prudential regulator and the Bureau 
     shall, with respect to each insured depository institution, 
     insured credit union, or other covered person described in 
     subsection (a) that is supervised by the prudential regulator 
     and the Bureau, respectively--
       (A) coordinate the scheduling of examinations of the 
     insured depository institution, insured credit union, or 
     other covered person described in subsection (a);
       (B) conduct simultaneous examinations of each insured 
     depository institution, insured credit union, or other 
     covered person described in subsection (a), unless such 
     institution requests examinations to be conducted separately;
       (C) share each draft report of examination with the other 
     agency and permit the receiving agency a reasonable 
     opportunity (which shall not be less than a period of 30 days 
     after the date of receipt) to comment on the draft report 
     before such report is made final; and
       (D) prior to issuing a final report of examination or 
     taking supervisory action, take into consideration concerns, 
     if any, raised in the comments made by the other agency.
       (2) Coordination with state bank supervisors.--The Bureau 
     shall pursue arrangements and agreements with State bank 
     supervisors to coordinate examinations, consistent with 
     paragraph (1).
       (3) Avoidance of conflict in supervision.--
       (A) Request.--If the proposed supervisory determinations of 
     the Bureau and a prudential regulator (in this section 
     referred to collectively as the ``agencies'') are 
     conflicting, an insured depository institution, insured 
     credit union, or other covered person described in subsection 
     (a) may request the agencies to coordinate and present a 
     joint statement of coordinated supervisory action.

[[Page S3236]]

       (B) Joint statement.--The agencies shall provide a joint 
     statement under subparagraph (A), not later than 30 days 
     after the date of receipt of the request of the insured 
     depository institution, credit union, or covered person 
     described in subsection (a).
       (4) Appeals to governing panel.--
       (A) In general.--If the agencies do not resolve the 
     conflict or issue a joint statement required by subparagraph 
     (B), or if either of the agencies takes or attempts to take 
     any supervisory action relating to the request for the joint 
     statement without the consent of the other agency, an insured 
     depository institution, insured credit union, or other 
     covered person described in subsection (a) may institute an 
     appeal to a governing panel, as provided in this subsection, 
     not later than 30 days after the expiration of the period 
     during which a joint statement is required to be filed under 
     paragraph (3)(B).
       (B) Composition of governing panel.--The governing panel 
     for an appeal under this paragraph shall be composed of--
       (i) a representative from the Bureau and a representative 
     of the prudential regulator, both of whom--

       (I) have not participated in the material supervisory 
     determinations under appeal; and
       (II) do not directly or indirectly report to the person who 
     participated materially in the supervisory determinations 
     under appeal; and

       (ii) one individual representative, to be determined on a 
     rotating basis, from among the Board of Governors, the 
     Corporation, the National Credit Union Administration, and 
     the Office of the Comptroller of the Currency, other than any 
     agency involved in the subject dispute.
       (C) Conduct of appeal.--In an appeal under this paragraph--
       (i) the insured depository institution, insured credit 
     union, or other covered person described in subsection (a)--

       (I) shall include in its appeal all the facts and legal 
     arguments pertaining to the matter; and
       (II) may, through counsel, employees, or representatives, 
     appear before the governing panel in person or by telephone; 
     and

       (ii) the governing panel--

       (I) may request the insured depository institution, insured 
     credit union, or other covered person described in subsection 
     (a), the Bureau, or the prudential regulator to produce 
     additional information relevant to the appeal; and
       (II) by a majority vote of its members, shall provide a 
     final determination, in writing, not later than 30 days after 
     the date of filing of an informationally complete appeal, or 
     such longer period as the panel and the insured depository 
     institution, insured credit union, or other covered person 
     described in subsection (a) may jointly agree.

       (D) Public availability of determinations.--A governing 
     panel shall publish all information contained in a 
     determination by the governing panel, with appropriate 
     redactions of information that would be subject to an 
     exemption from disclosure under section 552 of title 5, 
     United States Code.
       (E) Prohibition against retaliation.--The Bureau and the 
     prudential regulators shall prescribe rules to provide 
     safeguards from retaliation against the insured depository 
     institution, insured credit union, or other covered person 
     described in subsection (a) instituting an appeal under this 
     paragraph, as well as their officers and employees.
       (F) Limitation.--The process provided in this paragraph 
     shall not apply to a determination by a prudential regulator 
     to appoint a conservator or receiver for an insured 
     depository institution or a liquidating agent for an insured 
     credit union, as the case may be, or a decision to take 
     action pursuant to section 38 of the Federal Deposit 
     Insurance Act (12 U.S.C. 1831o) or section 212 of the Federal 
     Credit Union Act (112 U.S.C. 1790a), as applicable.
       (G) Effect on other authority.--Nothing in this section 
     shall modify or limit the authority of the Bureau to 
     interpret, or take enforcement action under, any Federal 
     consumer financial law.

     SEC. 1026. OTHER BANKS, SAVINGS ASSOCIATIONS, AND CREDIT 
                   UNIONS.

       (a) Scope of Coverage.--This section shall apply to any 
     covered person that is--
       (1) an insured depository institution with total assets of 
     $10,000,000,000 or less; or
       (2) an insured credit union with total assets of 
     $10,000,000,000 or less.
       (b) Reports.--The Director may require reports from a 
     person described in subsection (a), as necessary to support 
     the role of the Bureau in implementing Federal consumer 
     financial law, to support its examination activities under 
     subsection (c), and to assess and detect risks to consumers 
     and consumer financial markets.
       (1) Use of existing reports.--The Bureau shall, to the 
     fullest extent possible, use--
       (A) reports pertaining to a person described in subsection 
     (a) that have been provided or required to have been provided 
     to a Federal or State agency; and
       (B) information that has been reported publicly.
       (2) Preservation of authority.--Nothing in this subsection 
     may be construed as limiting the authority of the Director 
     from requiring from a person described in subsection (a), as 
     permitted under paragraph (1), information owned or under the 
     control of such person, regardless of whether such 
     information is maintained, stored, or processed by another 
     person.
       (3) Reports of tax law noncompliance.--The Bureau shall 
     provide the Commissioner of Internal Revenue with any report 
     of examination or related information identifying possible 
     tax law noncompliance.
       (c) Examinations.--
       (1) In general.--The Bureau may, at its discretion, include 
     examiners on a sampling basis of the examinations performed 
     by the prudential regulator of persons described in 
     subsection (a).
       (2) Agency coordination.--The prudential regulator shall--
       (A) provide all reports, records, and documentation related 
     to the examination process for any institution included in 
     the sample referred to in paragraph (1) to the Bureau on a 
     timely and continual basis;
       (B) involve such Bureau examiner in the entire examination 
     process for such person; and
       (C) consider input of the Bureau concerning the scope of an 
     examination, conduct of the examination, the contents of the 
     examination report, the designation of matters requiring 
     attention, and examination ratings.
       (d) Enforcement.--
       (1) In general.--Except for requiring reports under 
     subsection (b), the prudential regulator shall have exclusive 
     authority to enforce compliance with respect to a person 
     described in subsection (a).
       (2) Coordination with prudential regulator.--
       (A) Referral.--When the Bureau has reason to believe that a 
     person described in subsection (a) has engaged in a material 
     violation of a Federal consumer financial law, the Bureau 
     shall notify the prudential regulator in writing and 
     recommend appropriate action to respond.
       (B) Response.--Upon receiving a recommendation under 
     subparagraph (A), the prudential regulator shall provide a 
     written response to the Bureau not later than 60 days 
     thereafter.
       (e) Service Providers.--A service provider to a substantial 
     number of persons described in subsection (a) shall be 
     subject to the authority of the Bureau under section 1025 to 
     the same extent as if the Bureau were an appropriate Federal 
     bank agency under section 7(c) of the Bank Service Company 
     Act (12 U.S.C. 1867(c)). When conducting any examination or 
     requiring any report from a service provider subject to this 
     subsection, the Bureau shall coordinate with the appropriate 
     prudential regulator.

     SEC. 1027. LIMITATIONS ON AUTHORITIES OF THE BUREAU; 
                   PRESERVATION OF AUTHORITIES.

       (a) Exclusion for Merchants, Retailers, and Other Sellers 
     of Nonfinancial Goods or Services.--
       (1) Sale or brokerage of nonfinancial good or service.--The 
     Bureau may not exercise any rulemaking, supervisory, 
     enforcement or other authority under this title with respect 
     to a person who is a merchant, retailer, or seller of any 
     nonfinancial good or service and is engaged in the sale or 
     brokerage of such nonfinancial good or service, except to the 
     extent that such person is engaged in offering or providing 
     any consumer financial product or service, or is otherwise 
     subject to any enumerated consumer law or any law for which 
     authorities are transferred under subtitle F or H.
       (2) Offering or provision of certain consumer financial 
     products or services in connection with the sale or brokerage 
     of nonfinancial good or service.--
       (A) In general.--Except as provided in subparagraph (B), 
     and subject to subparagraph (C), the Bureau may not exercise 
     any rulemaking, supervisory, enforcement, or other authority 
     under this title with respect to a merchant, retailer, or 
     seller of nonfinancial goods or services who--
       (i) extends credit directly to a consumer, in a case in 
     which the good or service being provided is not itself a 
     consumer financial product or service (other than credit 
     described in this subparagraph), exclusively for the purpose 
     of enabling that consumer to purchase such nonfinancial good 
     or service directly from the merchant, retailer, or seller;
       (ii) directly, or through an agreement with another person, 
     collects debt arising from credit extended as described in 
     clause (i); or
       (iii) sells or conveys debt described in clause (i) that is 
     delinquent or otherwise in default.
       (B) Applicability.--Subparagraph (A) does not apply to any 
     credit transaction or collection of debt, other than as 
     described in subparagraph (C), arising from a transaction 
     described in subparagraph (A)--
       (i) in which the merchant, retailer, or seller of 
     nonfinancial goods or services assigns, sells or otherwise 
     conveys to another person such debt owed by the consumer 
     (except for a sale of debt that is delinquent or otherwise in 
     default, as described in subparagraph (A)(iii));
       (ii) in which the credit extended exceeds the market value 
     of the nonfinancial good or service provided, or the Bureau 
     otherwise finds that the sale of the nonfinancial good or 
     service is done as a subterfuge, so as to evade or circumvent 
     the provisions of this title; or
       (iii) in which the merchant, retailer, or seller of 
     nonfinancial goods or services regularly extends credit and 
     the credit is--

       (I) subject to a finance charge; or
       (II) payable by written agreement in more than 4 
     installments.

       (C) Limitation.--Notwithstanding subparagraph (B), the 
     Bureau may not exercise any rulemaking, supervisory, 
     enforcement, or

[[Page S3237]]

     other authority under this title with respect to a merchant, 
     retailer, or seller of nonfinancial goods or services that is 
     not engaged significantly in offering or providing consumer 
     financial products or services.
       (D) Rule of construction.--No provision of this title may 
     be construed as modifying, limiting, or superseding the 
     supervisory or enforcement authority of the Federal Trade 
     Commission or any other agency (other than the Bureau) with 
     respect to credit extended, or the collection of debt arising 
     from such extension, directly by a merchant or retailer to a 
     consumer exclusively for the purpose of enabling that 
     consumer to purchase nonfinancial goods or services directly 
     from the merchant or retailer.
       (b) Exclusion for Real Estate Brokerage Activities.--
       (1) Real estate brokerage activities excluded.--Without 
     limiting subsection (a), and except as permitted in paragraph 
     (2), the Bureau may not exercise any rulemaking, supervisory, 
     enforcement, or other authority under this title with respect 
     to a person that is licensed or registered as a real estate 
     broker or real estate agent, in accordance with State law, to 
     the extent that such person--
       (A) acts as a real estate agent or broker for a buyer, 
     seller, lessor, or lessee of real property;
       (B) brings together parties interested in the sale, 
     purchase, lease, rental, or exchange of real property;
       (C) negotiates, on behalf of any party, any portion of a 
     contract relating to the sale, purchase, lease, rental, or 
     exchange of real property (other than in connection with the 
     provision of financing with respect to any such transaction); 
     or
       (D) offers to engage in any activity, or act in any 
     capacity, described in subparagraph (A), (B), or (C).
       (2) Description of activities.--Paragraph (1) shall not 
     apply to any person to the extent that such person is engaged 
     in the offering or provision of any consumer financial 
     product or service or is otherwise subject to any enumerated 
     consumer law or any law for which authorities are transferred 
     under subtitle F or H.
       (c) Exclusion for Manufactured Home Retailers and Modular 
     Home Retailers.--
       (1) In general.--The Director may not exercise any 
     rulemaking, supervisory, enforcement, or other authority over 
     a person to the extent that--
       (A) such person is not described in paragraph (2); and
       (B) such person--
       (i) acts as an agent or broker for a buyer or seller of a 
     manufactured home or a modular home;
       (ii) facilitates the purchase by a consumer of a 
     manufactured home or modular home, by negotiating the 
     purchase price or terms of the sales contract (other than 
     providing financing with respect to such transaction); or
       (iii) offers to engage in any activity described in clause 
     (i) or (ii).
       (2) Description of activities.--A person is described in 
     this paragraph to the extent that such person is engaged in 
     the offering or provision of any consumer financial product 
     or service or is otherwise subject to any enumerated consumer 
     law or any law for which authorities are transferred under 
     subtitle F or H.
       (3) Definitions.--For purposes of this subsection, the 
     following definitions shall apply:
       (A) Manufactured home.--The term ``manufactured home'' has 
     the same meaning as in section 603 of the National 
     Manufactured Housing Construction and Safety Standards Act of 
     1974 (42 U.S.C. 5402).
       (B) Modular home.--The term ``modular home'' means a house 
     built in a factory in 2 or more modules that meet the State 
     or local building codes where the house will be located, and 
     where such modules are transported to the building site, 
     installed on foundations, and completed.
       (d) Exclusion for Accountants and Tax Preparers.--
       (1) In general.--Except as permitted in paragraph (2), the 
     Bureau may not exercise any rulemaking, supervisory, 
     enforcement, or other authority over--
       (A) any person that is a certified public accountant, 
     permitted to practice as a certified public accounting firm, 
     or certified or licensed for such purpose by a State, or any 
     individual who is employed by or holds an ownership interest 
     with respect to a person described in this subparagraph, when 
     such person is performing or offering to perform--
       (i) customary and usual accounting activities, including 
     the provision of accounting, tax, advisory, or other services 
     that are subject to the regulatory authority of a State board 
     of accountancy or a Federal authority; or
       (ii) other services that are incidental to such customary 
     and usual accounting activities, to the extent that such 
     incidental services are not offered or provided--

       (I) by the person separate and apart from such customary 
     and usual accounting activities; or
       (II) to consumers who are not receiving such customary and 
     usual accounting activities; or

       (B) any person, other than a person described in 
     subparagraph (A) that performs income tax preparation 
     activities for consumers.
       (2) Description of activities.--
       (A) In general.--Paragraph (1) shall not apply to any 
     person described in paragraph (1)(A) or (1)(B) to the extent 
     that such person is engaged in any activity which is not a 
     customary and usual accounting activity described in 
     paragraph (1)(A) or incidental thereto but which is the 
     offering or provision of any consumer financial product or 
     service, except to the extent that a person described in 
     paragraph (1)(A) is engaged in an activity which is a 
     customary and usual accounting activity described in 
     paragraph (1)(A), or incidental thereto.
       (B) Not a customary and usual accounting activity.--For 
     purposes of this subsection, extending or brokering credit is 
     not a customary and usual accounting activity, or incidental 
     thereto.
       (C) Rule of construction.--For purposes of subparagraphs 
     (A) and (B), a person described in paragraph (1)(A) shall not 
     be deemed to be extending credit, if such person is only 
     extending credit directly to a consumer, exclusively for the 
     purpose of enabling such consumer to purchase services 
     described in clause (i) or (ii) of paragraph (1)(A) directly 
     from such person, and such credit is--
       (i) not subject to a finance charge; and
       (ii) not payable by written agreement in more than 4 
     installments.
       (D) Other limitations.--Paragraph (1) does not apply to any 
     person described in paragraph (1)(A) or (1)(B) that is 
     otherwise subject to any enumerated consumer law or any law 
     for which authorities are transferred under subtitle F or H.
       (e) Exclusion for Attorneys.--
       (1) In general.--The Bureau may not exercise any authority 
     to conduct examinations of an attorney licensed by a State, 
     to the extent that the attorney is engaged in the practice of 
     law under the laws of such State.
       (2) Exception for enumerated consumer laws and transferred 
     authorities.--Paragraph (1) shall not apply to an attorney 
     who is engaged in the offering or provision of any consumer 
     financial product or service, or is otherwise subject to any 
     enumerated consumer law or any law for which authorities are 
     transferred under subtitle F or H.
       (f) Exclusion for Persons Regulated by a State Insurance 
     Regulator.--
       (1) In general.--No provision of this title shall be 
     construed as altering, amending, or affecting the authority 
     of any State insurance regulator to adopt rules, initiate 
     enforcement proceedings, or take any other action with 
     respect to a person regulated by a State insurance regulator. 
     Except as provided in paragraph (2), the Bureau shall have no 
     authority to exercise any power to enforce this title with 
     respect to a person regulated by a State insurance regulator.
       (2) Description of activities.--Paragraph (1) does not 
     apply to any person described in such paragraph to the extent 
     that such person is engaged in the offering or provision of 
     any consumer financial product or service or is otherwise 
     subject to any enumerated consumer law or any law for which 
     authorities are transferred under subtitle F or H.
       (g) Exclusion for Employee Benefit and Compensation Plans 
     and Certain Other Arrangements Under the Internal Revenue 
     Code of 1986.--
       (1) Preservation of authority of other agencies.--No 
     provision of this title shall be construed as altering, 
     amending, or affecting the authority of the Secretary of the 
     Treasury, the Secretary of Labor, or the Commissioner of 
     Internal Revenue to adopt regulations, initiate enforcement 
     proceedings, or take any actions with respect to any 
     specified plan or arrangement.
       (2) Activities not constituting the offering or provision 
     of any consumer financial product or service.--For purposes 
     of this title, a person shall not be treated as having 
     engaged in the offering or provision of any consumer 
     financial product or service solely because such person is a 
     specified plan or arrangement, or is engaged in the activity 
     of establishing or maintaining, for the benefit of employees 
     of such person (or for members of an employee organization), 
     any specified plan or arrangement.
       (3) Limitation on bureau authority.--
       (A) In general.--Except as provided under subparagraphs (B) 
     and (C), the Bureau may not exercise any rulemaking or 
     enforcement authority with respect to products or services 
     that relate to any specified plan or arrangement.
       (B) Bureau action only pursuant to agency request.--The 
     Secretary and the Secretary of Labor may jointly issue a 
     written request to the Bureau regarding implementation of 
     appropriate consumer protection standards under this title 
     with respect to the provision of services relating to any 
     specified plan or arrangement. Subject to a request made 
     under this subparagraph, the Bureau may exercise rulemaking 
     authority, and may act to enforce a rule prescribed pursuant 
     to such request, in accordance with the provisions of this 
     title. A request made by the Secretary and the Secretary of 
     Labor under this subparagraph shall describe the basis for, 
     and scope of, appropriate consumer protection standards to be 
     implemented under this title with respect to the provision of 
     services relating to any specified plan or arrangement.
       (C) Description of products or services.--To the extent 
     that a person engaged in providing products or services 
     relating to any specified plan or arrangement is subject to 
     any enumerated consumer law or any law for which authorities 
     are transferred under subtitle F or H, subparagraph (A) shall 
     not apply with respect to that law.
       (4) Specified plan or arrangement.--For purposes of this 
     subsection, the term ``specified plan or arrangement'' means 
     any plan, account, or arrangement described in section

[[Page S3238]]

     220, 223, 401(a), 403(a), 403(b), 408, 408A, 529, or 530 of 
     the Internal Revenue Code of 1986, or any employee benefit or 
     compensation plan or arrangement, including a plan that is 
     subject to title I of the Employee Retirement Income Security 
     Act of 1974.
       (h) Persons Regulated by a State Securities Commission.--
       (1) In general.--No provision of this title shall be 
     construed as altering, amending, or affecting the authority 
     of any securities commission (or any agency or office 
     performing like functions) of any State to adopt rules, 
     initiate enforcement proceedings, or take any other action 
     with respect to a person regulated by any securities 
     commission (or any agency or office performing like 
     functions) of any State. Except as permitted in paragraph (2) 
     and subsection (f), the Bureau shall have no authority to 
     exercise any power to enforce this title with respect to a 
     person regulated by any securities commission (or any agency 
     or office performing like functions) of any State, but only 
     to the extent that the person acts in such regulated 
     capacity.
       (2) Description of activities.--Paragraph (1) shall not 
     apply to any person to the extent such person is engaged in 
     the offering or provision of any consumer financial product 
     or service, or is otherwise subject to any enumerated 
     consumer law or any law for which authorities are transferred 
     under subtitle F or H.
       (i) Exclusion for Persons Regulated by the Commission.--
       (1) In general.--No provision of this title may be 
     construed as altering, amending, or affecting the authority 
     of the Commission to adopt rules, initiate enforcement 
     proceedings, or take any other action with respect to a 
     person regulated by the Commission. The Bureau shall have no 
     authority to exercise any power to enforce this title with 
     respect to a person regulated by the Commission.
       (2) Consultation and coordination.--Notwithstanding 
     paragraph (1), the Commission shall consult and coordinate, 
     where feasible, with the Bureau with respect to any rule 
     (including any advance notice of proposed rulemaking) 
     regarding an investment product or service that is the same 
     type of product as, or that competes directly with, a 
     consumer financial product or service that is subject to the 
     jurisdiction of the Bureau under this title or under any 
     other law. In carrying out this paragraph, the agencies shall 
     negotiate an agreement to establish procedures for such 
     coordination, including procedures for providing advance 
     notice to the Bureau when the Commission is initiating a 
     rulemaking.
       (j) Exclusion for Persons Regulated by the Commodity 
     Futures Trading Commission.--
       (1) In general.--No provision of this title shall be 
     construed as altering, amending, or affecting the authority 
     of the Commodity Futures Trading Commission to adopt rules, 
     initiate enforcement proceedings, or take any other action 
     with respect to a person regulated by the Commodity Futures 
     Trading Commission. The Bureau shall have no authority to 
     exercise any power to enforce this title with respect to a 
     person regulated by the Commodity Futures Trading Commission.
       (2) Consultation and coordination.--Notwithstanding 
     paragraph (1), the Commodity Futures Trading Commission shall 
     consult and coordinate with the Bureau with respect to any 
     rule (including any advance notice of proposed rulemaking) 
     regarding a product or service that is the same type of 
     product as, or that competes directly with, a consumer 
     financial product or service that is subject to the 
     jurisdiction of the Bureau under this title or under any 
     other law.
       (k) Exclusion for Persons Regulated by the Farm Credit 
     Administration.--
       (1) In general.--No provision of this title shall be 
     construed as altering, amending, or affecting the authority 
     of the Farm Credit Administration to adopt rules, initiate 
     enforcement proceedings, or take any other action with 
     respect to a person regulated by the Farm Credit 
     Administration. The Bureau shall have no authority to 
     exercise any power to enforce this title with respect to a 
     person regulated by the Farm Credit Administration.
       (2) Definition.--For purposes of this subsection, the term 
     ``person regulated by the Farm Credit Administration'' means 
     any Farm Credit System institution that is chartered and 
     subject to the provisions of the Farm Credit Act of 1971 (12 
     U.S.C. 2001 et seq.).
       (l) Exclusion for Activities Relating to Charitable 
     Contributions.--
       (1) In general.--The Director and the Bureau may not 
     exercise any rulemaking, supervisory, enforcement, or other 
     authority, including authority to order penalties, over any 
     activities related to the solicitation or making of voluntary 
     contributions to a tax-exempt organization as recognized by 
     the Internal Revenue Service, by any agent, volunteer, or 
     representative of such organizations to the extent the 
     organization, agent, volunteer, or representative thereof is 
     soliciting or providing advice, information, education, or 
     instruction to any donor or potential donor relating to a 
     contribution to the organization.
       (2) Limitation.--The exclusion in paragraph (1) does not 
     apply to other activities not described in paragraph (1) that 
     are the offering or provision of any consumer financial 
     product or service, or are otherwise subject to any 
     enumerated consumer law or any law for which authorities are 
     transferred under subtitle F or H.
       (m) Insurance.--The Bureau may not define as a financial 
     product or service, by regulation or otherwise, engaging in 
     the business of insurance.
       (n) Limited Authority of the Bureau.--Notwithstanding 
     subsections (a) through (h) and (l), a person subject to or 
     described in one or more of such subsections--
       (1) may be a service provider; and
       (2) may be subject to requests from, or requirements 
     imposed by, the Bureau regarding information in order to 
     carry out the responsibilities and functions of the Bureau 
     and in accordance with section 1022, 1052, or 1053.
       (o) No Authority To Impose Usury Limit.--No provision of 
     this title shall be construed as conferring authority on the 
     Bureau to establish a usury limit applicable to an extension 
     of credit offered or made by a covered person to a consumer, 
     unless explicitly authorized by law.
       (p) Attorney General.--No provision of this title, 
     including section 1024(c)(1), shall affect the authorities of 
     the Attorney General under otherwise applicable provisions of 
     law.
       (q) Secretary of the Treasury.--No provision of this title 
     shall affect the authorities of the Secretary, including with 
     respect to prescribing rules, initiating enforcement 
     proceedings, or taking other actions with respect to a person 
     that performs income tax preparation activities for 
     consumers.
       (r) Deposit Insurance and Share Insurance.--Nothing in this 
     title shall affect the authority of the Corporation under the 
     Federal Deposit Insurance Act or the National Credit Union 
     Administration Board under the Federal Credit Union Act as to 
     matters related to deposit insurance and share insurance, 
     respectively.

     SEC. 1028. AUTHORITY TO RESTRICT MANDATORY PRE-DISPUTE 
                   ARBITRATION.

       (a) Study and Report.--The Bureau shall conduct a study of, 
     and shall provide a report to Congress concerning, the use of 
     agreements providing for arbitration of any future dispute 
     between covered persons and consumers in connection with the 
     offering or providing of consumer financial products or 
     services.
       (b) Further Authority.--The Bureau, by regulation, may 
     prohibit or impose conditions or limitations on the use of an 
     agreement between a covered person and a consumer for a 
     consumer financial product or service providing for 
     arbitration of any future dispute between the parties, if the 
     Bureau finds that such a prohibition or imposition of 
     conditions or limitations is in the public interest and for 
     the protection of consumers. The findings in such rule shall 
     be consistent with the study conducted under subsection (a).
       (c) Limitation.--The authority described in subsection (b) 
     may not be construed to prohibit or restrict a consumer from 
     entering into a voluntary arbitration agreement with a 
     covered person after a dispute has arisen.
       (d) Effective Date.--Notwithstanding any other provision of 
     law, any regulation prescribed by the Bureau under subsection 
     (a) shall apply, consistent with the terms of the regulation, 
     to any agreement between a consumer and a covered person 
     entered into after the end of the 180-day period beginning on 
     the effective date of the regulation, as established by the 
     Bureau.

     SEC. 1029. EFFECTIVE DATE.

       This subtitle shall become effective on the designated 
     transfer date.

                Subtitle C--Specific Bureau Authorities

     SEC. 1031. PROHIBITING UNFAIR, DECEPTIVE, OR ABUSIVE ACTS OR 
                   PRACTICES.

       (a) In General.--The Bureau may take any action authorized 
     under subtitle E to prevent a covered person or service 
     provider from committing or engaging in an unfair, deceptive, 
     or abusive act or practice under Federal law in connection 
     with any transaction with a consumer for a consumer financial 
     product or service, or the offering of a consumer financial 
     product or service.
       (b) Rulemaking.--The Bureau may prescribe rules applicable 
     to a covered person or service provider identifying as 
     unlawful unfair, deceptive, or abusive acts or practices in 
     connection with any transaction with a consumer for a 
     consumer financial product or service, or the offering of a 
     consumer financial product or service. Rules under this 
     section may include requirements for the purpose of 
     preventing such acts or practices.
       (c) Unfairness.--
       (1) In general.--The Bureau shall have no authority under 
     this section to declare an act or practice in connection with 
     a transaction with a consumer for a consumer financial 
     product or service, or the offering of a consumer financial 
     product or service, to be unlawful on the grounds that such 
     act or practice is unfair, unless the Bureau has a reasonable 
     basis to conclude that--
       (A) the act or practice causes or is likely to cause 
     substantial injury to consumers which is not reasonably 
     avoidable by consumers; and
       (B) such substantial injury is not outweighed by 
     countervailing benefits to consumers or to competition.
       (2) Consideration of public policies.--In determining 
     whether an act or practice is unfair, the Bureau may consider 
     established public policies as evidence to be considered with 
     all other evidence. Such public policy considerations may not 
     serve as a primary basis for such determination.
       (d) Abusive.--The Bureau shall have no authority under this 
     section to declare an act

[[Page S3239]]

     or practice abusive in connection with the provision of a 
     consumer financial product or service, unless the act or 
     practice--
       (1) materially interferes with the ability of a consumer to 
     understand a term or condition of a consumer financial 
     product or service; or
       (2) takes unreasonable advantage of--
       (A) a lack of understanding on the part of the consumer of 
     the material risks, costs, or conditions of the product or 
     service;
       (B) the inability of the consumer to protect the interests 
     of the consumer in selecting or using a consumer financial 
     product or service; or
       (C) the reasonable reliance by the consumer on a covered 
     person to act in the interests of the consumer.
       (e) Consultation.--In prescribing rules under this section, 
     the Bureau shall consult with the Federal banking agencies, 
     or other Federal agencies, as appropriate, concerning the 
     consistency of the proposed rule with prudential, market, or 
     systemic objectives administered by such agencies.

     SEC. 1032. DISCLOSURES.

       (a) In General.--The Bureau may prescribe rules to ensure 
     that the features of any consumer financial product or 
     service, both initially and over the term of the product or 
     service, are fully, accurately, and effectively disclosed to 
     consumers in a manner that permits consumers to understand 
     the costs, benefits, and risks associated with the product or 
     service, in light of the facts and circumstances.
       (b) Model Disclosures.--
       (1) In general.--Any final rule prescribed by the Bureau 
     under this section requiring disclosures may include a model 
     form that may be used at the option of the covered person for 
     provision of the required disclosures.
       (2) Format.--A model form issued pursuant to paragraph (1) 
     shall contain a clear and conspicuous disclosure that, at a 
     minimum--
       (A) uses plain language comprehensible to consumers;
       (B) contains a clear format and design, such as an easily 
     readable type font; and
       (C) succinctly explains the information that must be 
     communicated to the consumer.
       (3) Consumer testing.--Any model form issued pursuant to 
     this subsection shall be validated through consumer testing.
       (c) Basis for Rulemaking.--In prescribing rules under this 
     section, the Bureau shall consider available evidence about 
     consumer awareness, understanding of, and responses to 
     disclosures or communications about the risks, costs, and 
     benefits of consumer financial products or services.
       (d) Safe Harbor.--Any covered person that uses a model form 
     included with a rule issued under this section shall be 
     deemed to be in compliance with the disclosure requirements 
     of this section with respect to such model form.
       (e) Trial Disclosure Programs.--
       (1) In general.--The Bureau may permit a covered person to 
     conduct a trial program that is limited in time and scope, 
     subject to specified standards and procedures, for the 
     purpose of providing trial disclosures to consumers that are 
     designed to improve upon any model form issued pursuant to 
     subsection (b)(1), or any other model form issued to 
     implement an enumerated statute, as applicable.
       (2) Safe harbor.--The standards and procedures issued by 
     the Bureau shall be designed to encourage covered persons to 
     conduct trial disclosure programs. For the purposes of 
     administering this subsection, the Bureau may establish a 
     limited period during which a covered person conducting a 
     trial disclosure program shall be deemed to be in compliance 
     with, or may be exempted from, a requirement of a rule or an 
     enumerated consumer law.
       (3) Public disclosure.--The rules of the Bureau shall 
     provide for public disclosure of trial disclosure programs, 
     which public disclosure may be limited, to the extent 
     necessary to encourage covered persons to conduct effective 
     trials.
       (f) Combined Mortgage Loan Disclosure.--Not later than 1 
     year after the designated transfer date, the Bureau shall 
     propose for public comment rules and model disclosures that 
     combine the disclosures required under the Truth in Lending 
     Act and the Real Estate Settlement Procedures Act of 1974, 
     into a single, integrated disclosure for mortgage loan 
     transactions covered by those laws, unless the Bureau 
     determines that any proposal issued by the Board of Governors 
     and the Secretary of Housing and Urban Development carries 
     out the same purpose.

     SEC. 1033. CONSUMER RIGHTS TO ACCESS INFORMATION.

       (a) In General.--Subject to rules prescribed by the Bureau, 
     a covered person shall make available to a consumer, upon 
     request, information in the control or possession of the 
     covered person concerning the consumer financial product or 
     service that the consumer obtained from such covered person, 
     including information relating to any transaction, series of 
     transactions, or to the account including costs, charges and 
     usage data. The information shall be made available in an 
     electronic form usable by consumers.
       (b) Exceptions.--A covered person may not be required by 
     this section to make available to the consumer--
       (1) any confidential commercial information, including an 
     algorithm used to derive credit scores or other risk scores 
     or predictors;
       (2) any information collected by the covered person for the 
     purpose of preventing fraud or money laundering, or 
     detecting, or making any report regarding other unlawful or 
     potentially unlawful conduct;
       (3) any information required to be kept confidential by any 
     other provision of law; or
       (4) any information that the covered person cannot retrieve 
     in the ordinary course of its business with respect to that 
     information.
       (c) No Duty To Maintain Records.--Nothing in this section 
     shall be construed to impose any duty on a covered person to 
     maintain or keep any information about a consumer.
       (d) Standardized Formats for Data.--The Bureau, by rule, 
     shall prescribe standards applicable to covered persons to 
     promote the development and use of standardized formats for 
     information, including through the use of machine readable 
     files, to be made available to consumers under this section.
       (e) Consultation.--The Bureau shall, when prescribing any 
     rule under this section, consult with the Federal banking 
     agencies and the Federal Trade Commission to ensure that the 
     rules--
       (1) impose substantively similar requirements on covered 
     persons;
       (2) take into account conditions under which covered 
     persons do business both in the United States and in other 
     countries; and
       (3) do not require or promote the use of any particular 
     technology in order to develop systems for compliance.

     SEC. 1034. RESPONSE TO CONSUMER COMPLAINTS AND INQUIRIES.

       (a) Timely Regulator Response to Consumers.--The Bureau 
     shall establish, in consultation with the appropriate Federal 
     regulatory agencies, reasonable procedures to provide a 
     timely response to consumers, in writing where appropriate, 
     to complaints against, or inquiries concerning, a covered 
     person, including--
       (1) all steps that have been taken by the regulator in 
     response to the complaint or inquiry of the consumer;
       (2) any responses received by the regulator from the 
     covered person; and
       (3) any follow-up actions or planned follow-up actions by 
     the regulator in response to the complaint or inquiry of the 
     consumer.
       (b) Timely Response to Regulator by Covered Person.--A 
     covered person subject to supervision and primary enforcement 
     by the Bureau pursuant to section 1025 shall provide a timely 
     response, in writing where appropriate, to the Bureau, the 
     prudential regulators, and any other agency having 
     jurisdiction over such covered person concerning a consumer 
     complaint or inquiry, including--
       (1) steps that have been taken by the covered person to 
     respond to the complaint or inquiry of the consumer;
       (2) responses received by the covered person from the 
     consumer; and
       (3) follow-up actions or planned follow-up actions by the 
     covered person to respond to the complaint or inquiry of the 
     consumer.
       (c) Provision of Information to Consumers.--
       (1) In general.--A covered person subject to supervision 
     and primary enforcement by the Bureau pursuant to section 
     1025 shall, in a timely manner, comply with a consumer 
     request for information in the control or possession of such 
     covered person concerning the consumer financial product or 
     service that the consumer obtained from such covered person, 
     including supporting written documentation, concerning the 
     account of the consumer.
       (2) Exceptions.--A covered person subject to supervision 
     and primary enforcement by the Bureau pursuant to section 
     1025, a prudential regulator, and any other agency having 
     jurisdiction over a covered person subject to supervision and 
     primary enforcement by the Bureau pursuant to section 1025 
     may not be required by this section to make available to the 
     consumer--
       (A) any confidential commercial information, including an 
     algorithm used to derive credit scores or other risk scores 
     or predictors;
       (B) any information collected by the covered person for the 
     purpose of preventing fraud or money laundering, or detecting 
     or making any report regarding other unlawful or potentially 
     unlawful conduct;
       (C) any information required to be kept confidential by any 
     other provision of law; or
       (D) any nonpublic or confidential information, including 
     confidential supervisory information.
       (d) Agreements With Other Agencies.--The Bureau shall enter 
     into a memorandum of understanding with any affected Federal 
     regulatory agency to establish procedures by which any 
     covered person, and the prudential regulators, and any other 
     agency having jurisdiction over a covered person, including 
     the Secretary of the Department of Housing and Urban 
     Development and the Secretary of Education, shall comply with 
     this section.

     SEC. 1035. PRIVATE EDUCATION LOAN OMBUDSMAN.

       (a) Establishment.--The Secretary, in consultation with the 
     Director, shall designate a Private Education Loan Ombudsman 
     (in this section referred to as the ``Ombudsman'') within the 
     Bureau, to provide timely assistance to borrowers of private 
     education loans.

[[Page S3240]]

       (b) Public Information.--The Secretary and the Director 
     shall disseminate information about the availability and 
     functions of the Ombudsman to borrowers and potential 
     borrowers, as well as institutions of higher education, 
     lenders, guaranty agencies, loan servicers, and other 
     participants in private education student loan programs.
       (c) Functions of Ombudsman.--The Ombudsman designated under 
     this subsection shall--
       (1) in accordance with regulations of the Director, 
     receive, review, and attempt to resolve informally complaints 
     from borrowers of loans described in subsection (a), 
     including, as appropriate, attempts to resolve such 
     complaints in collaboration with the Department of Education 
     and with institutions of higher education, lenders, guaranty 
     agencies, loan servicers, and other participants in private 
     education loan programs;
       (2) not later than 90 days after the designated transfer 
     date, establish a memorandum of understanding with the 
     student loan ombudsman established under section 141(f) of 
     the Higher Education Act of 1965 (20 U.S.C. 1018(f)), to 
     ensure coordination in providing assistance to and serving 
     borrowers seeking to resolve complaints related to their 
     private education or Federal student loans;
       (3) compile and analyze data on borrower complaints 
     regarding private education loans; and
       (4) make appropriate recommendations to the Director, the 
     Secretary, the Secretary of Education, the Committee on 
     Banking, Housing, and Urban Affairs and the Committee on 
     Health, Education, Labor, and Pensions of the Senate and the 
     Committee on Financial Services and the Committee on 
     Education and Labor of the House of Representatives.
       (d) Annual Reports.--
       (1) In general.--The Ombudsman shall prepare an annual 
     report that describes the activities, and evaluates the 
     effectiveness of the Ombudsman during the preceding year.
       (2) Submission.--The report required by paragraph (1) shall 
     be submitted on the same date annually to the Secretary, the 
     Secretary of Education, the Committee on Banking, Housing, 
     and Urban Affairs and the Committee on Health, Education, 
     Labor, and Pensions of the Senate and the Committee on 
     Financial Services and the Committee on Education and Labor 
     of the House of Representatives.
       (e) Definitions.--For purposes of this section, the terms 
     ``private education loan'' and ``institution of higher 
     education'' have the same meanings as in section 140 of the 
     Truth in Lending Act (15 U.S.C. 1650).

     SEC. 1036. EFFECTIVE DATE.

       This subtitle shall take effect on the designated transfer 
     date.

                 Subtitle D--Preservation of State Law

     SEC. 1041. RELATION TO STATE LAW.

       (a) In General.--
       (1) Rule of construction.--This title, other than sections 
     1044 through 1048, may not be construed as annulling, 
     altering, or affecting, or exempting any person subject to 
     the provisions of this title from complying with, the 
     statutes, regulations, orders, or interpretations in effect 
     in any State, except to the extent that any such provision of 
     law is inconsistent with the provisions of this title, and 
     then only to the extent of the inconsistency.
       (2) Greater protection under state law.--For purposes of 
     this subsection, a statute, regulation, order, or 
     interpretation in effect in any State is not inconsistent 
     with the provisions of this title if the protection that such 
     statute, regulation, order, or interpretation affords to 
     consumers is greater than the protection provided under this 
     title. A determination regarding whether a statute, 
     regulation, order, or interpretation in effect in any State 
     is inconsistent with the provisions of this title may be made 
     by the Bureau on its own motion or in response to a 
     nonfrivolous petition initiated by any interested person.
       (b) Relation to Other Provisions of Enumerated Consumer 
     Laws That Relate to State Law.--No provision of this title, 
     except as provided in section 1083, shall be construed as 
     modifying, limiting, or superseding the operation of any 
     provision of an enumerated consumer law that relates to the 
     application of a law in effect in any State with respect to 
     such Federal law.
       (c) Additional Consumer Protection Regulations in Response 
     to State Action.--
       (1) Notice of proposed rule required.--The Bureau shall 
     issue a notice of proposed rulemaking whenever a majority of 
     the States has enacted a resolution in support of the 
     establishment or modification of a consumer protection 
     regulation by the Bureau.
       (2) Bureau considerations required for issuance of final 
     regulation.--Before prescribing a final regulation based upon 
     a notice issued pursuant to paragraph (1), the Bureau shall 
     take into account whether--
       (A) the proposed regulation would afford greater protection 
     to consumers than any existing regulation;
       (B) the intended benefits of the proposed regulation for 
     consumers would outweigh any increased costs or 
     inconveniences for consumers, and would not discriminate 
     unfairly against any category or class of consumers; and
       (C) a Federal banking agency has advised that the proposed 
     regulation is likely to present an unacceptable safety and 
     soundness risk to insured depository institutions.
       (3) Explanation of considerations.--The Bureau--
       (A) shall include a discussion of the considerations 
     required in paragraph (2) in the Federal Register notice of a 
     final regulation prescribed pursuant to this subsection; and
       (B) whenever the Bureau determines not to prescribe a final 
     regulation, shall publish an explanation of such 
     determination in the Federal Register, and provide a copy of 
     such explanation to each State that enacted a resolution in 
     support of the proposed regulation, the Committee on 
     Financial Services of the House of Representatives, and the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate.
       (4) Reservation of authority.--No provision of this 
     subsection shall be construed as limiting or restricting the 
     authority of the Bureau to enhance consumer protection 
     standards established pursuant to this title in response to 
     its own motion or in response to a request by any other 
     interested person.
       (5) Rule of construction.--No provision of this subsection 
     shall be construed as exempting the Bureau from complying 
     with subchapter II of chapter 5 of title 5, United States 
     Code.
       (6) Definition.--For purposes of this subsection, the term 
     ``consumer protection regulation'' means a regulation that 
     the Bureau is authorized to prescribe under the Federal 
     consumer financial laws.

     SEC. 1042. PRESERVATION OF ENFORCEMENT POWERS OF STATES.

       (a) In General.--
       (1) Action by state.--The attorney general (or the 
     equivalent thereof) of any State may bring a civil action in 
     the name of such State, as parens patriae on behalf of 
     natural persons residing in such State, in any district court 
     of the United States in that State or in State court having 
     jurisdiction over the defendant, to enforce provisions of 
     this title or regulations issued thereunder and to secure 
     remedies under provisions of this title or remedies otherwise 
     provided under other law. A State regulator may bring a civil 
     action or other appropriate proceeding to enforce the 
     provisions of this title or regulations issued thereunder 
     with respect to any entity that is State-chartered, 
     incorporated, licensed, or otherwise authorized to do 
     business under State law, and to secure remedies under 
     provisions of this title or remedies otherwise provided under 
     other provisions of law with respect to a State-chartered 
     entity.
       (2) Rule of construction.--No provision of this title shall 
     be construed as modifying, limiting, or superseding the 
     operation of any provision of an enumerated consumer law that 
     relates to the authority of a State attorney general or State 
     regulator to enforce such Federal law.
       (b) Consultation Required.--
       (1) Notice.--
       (A) In general.--Before initiating any action in a court or 
     other administrative or regulatory proceeding against any 
     covered person to enforce any provision of this title, 
     including any regulation prescribed by the Director under 
     this title, a State attorney general or State regulator shall 
     timely provide a copy of the complete complaint to be filed 
     and written notice describing such action or proceeding to 
     the Bureau and the prudential regulator, if any, or the 
     designee thereof.
       (B) Emergency action.--If prior notice is not practicable, 
     the State attorney general or State regulator shall provide a 
     copy of the complete complaint and the notice to the Bureau 
     and the prudential regulator, if any, immediately upon 
     instituting the action or proceeding.
       (C) Contents of notice.--The notification required under 
     this paragraph shall, at a minimum, describe--
       (i) the identity of the parties;
       (ii) the alleged facts underlying the proceeding; and
       (iii) whether there may be a need to coordinate the 
     prosecution of the proceeding so as not to interfere with any 
     action, including any rulemaking, undertaken by the Director, 
     a prudential regulator, or another Federal agency.
       (2) Bureau response.--In any action described in paragraph 
     (1), the Bureau may--
       (A) intervene in the action as a party;
       (B) upon intervening--
       (i) remove the action to the appropriate United States 
     district court, if the action was not originally brought 
     there; and
       (ii) be heard on all matters arising in the action; and
       (C) appeal any order or judgment, to the same extent as any 
     other party in the proceeding may.
       (c) Regulations.--The Director shall prescribe regulations 
     to implement the requirements of this section and, from time 
     to time, provide guidance in order to further coordinate 
     actions with the State attorneys general and other 
     regulators.
       (d) Preservation of State Authority.--
       (1) State claims.--No provision of this section shall be 
     construed as altering, limiting, or affecting the authority 
     of a State attorney general or any other regulatory or 
     enforcement agency or authority to bring an action or other 
     regulatory proceeding arising solely under the law in effect 
     in that State.
       (2) State securities regulators.--No provision of this 
     title shall be construed as altering, limiting, or affecting 
     the authority of a State securities commission (or any agency 
     or office performing like functions) under State law to adopt 
     rules, initiate enforcement proceedings, or take any other 
     action with respect to a person regulated by such commission 
     or authority.

[[Page S3241]]

       (3) State insurance regulators.--No provision of this title 
     shall be construed as altering, limiting, or affecting the 
     authority of a State insurance commission or State insurance 
     regulator under State law to adopt rules, initiate 
     enforcement proceedings, or take any other action with 
     respect to a person regulated by such commission or 
     regulator.

     SEC. 1043. PRESERVATION OF EXISTING CONTRACTS.

       This title, and regulations, orders, guidance, and 
     interpretations prescribed, issued, or established by the 
     Bureau, shall not be construed to alter or affect the 
     applicability of any regulation, order, guidance, or 
     interpretation prescribed, issued, and established by the 
     Comptroller of the Currency or the Director of the Office of 
     Thrift Supervision regarding the applicability of State law 
     under Federal banking law to any contract entered into on or 
     before the date of the enactment of this title, by national 
     banks, Federal savings associations, or subsidiaries thereof 
     that are regulated and supervised by the Comptroller of the 
     Currency or the Director of the Office of Thrift Supervision, 
     respectively.

     SEC. 1044. STATE LAW PREEMPTION STANDARDS FOR NATIONAL BANKS 
                   AND SUBSIDIARIES CLARIFIED.

       (a) In General.--Chapter one of title LXII of the Revised 
     Statutes of the United States (12 U.S.C. 21 et seq.) is 
     amended by inserting after section 5136B the following new 
     section:

     ``SEC. 5136C. STATE LAW PREEMPTION STANDARDS FOR NATIONAL 
                   BANKS AND SUBSIDIARIES CLARIFIED.

       ``(a) Definitions.--For purposes of this section, the 
     following definitions shall apply:
       ``(1) National bank.--The term `national bank' includes--
       ``(A) any bank organized under the laws of the United 
     States; and
       ``(B) any Federal branch established in accordance with the 
     International Banking Act of 1978.
       ``(2) State consumer financial laws.--The term `State 
     consumer financial law' means a State law that does not 
     directly or indirectly discriminate against national banks 
     and that directly and specifically regulates the manner, 
     content, or terms and conditions of any financial transaction 
     (as may be authorized for national banks to engage in), or 
     any account related thereto, with respect to a consumer.
       ``(3) Other definitions.--The terms `affiliate', 
     `subsidiary', `includes', and `including' have the same 
     meanings as in section 3 of the Federal Deposit Insurance 
     Act.
       ``(b) Preemption Standard.--
       ``(1) In general.--State consumer financial laws are 
     preempted, only if--
       ``(A) application of a State consumer financial law would 
     have a discriminatory effect on national banks, in comparison 
     with the effect of the law on a bank chartered by that State;
       ``(B) the preemption of the State consumer financial law is 
     in accordance with the legal standard of the decision of the 
     Supreme Court of the United States in Barnett Bank of Marion 
     County, N.A. v. Nelson, Florida Insurance Commissioner, et 
     al, 517 U.S. 25 (1996), and a preemption determination under 
     this subparagraph may be made by a court or by regulation or 
     order of the Comptroller of the Currency, in accordance with 
     applicable law, on a case-by-case basis, and any such 
     determination by a court shall comply with the standards set 
     forth in subsection (d), with the court making the finding 
     under subsection (d), de novo; or
       ``(C) the State consumer financial law is preempted by a 
     provision of Federal law other than this title.
       ``(2) Savings clause.--This title does not preempt, annul, 
     or affect the applicability of any State law to any 
     subsidiary or affiliate of a national bank (other than a 
     subsidiary or affiliate that is chartered as a national 
     bank).
       ``(3) Case-by-case basis.--
       ``(A) Definition.--As used in this section the term `case-
     by-case basis' refers to a determination pursuant to this 
     section made by the Comptroller concerning the impact of a 
     particular State consumer financial law on any national bank 
     that is subject to that law, or the law of any other State 
     with substantively equivalent terms.
       ``(B) Consultation.--When making a determination on a case-
     by-case basis that a State consumer financial law of another 
     State has substantively equivalent terms as one that the 
     Comptroller is preempting, the Comptroller shall first 
     consult with the Bureau of Consumer Financial Protection and 
     shall take the views of the Bureau into account when making 
     the determination.
       ``(4) Rule of construction.--This title does not occupy the 
     field in any area of State law.
       ``(5) Standards of review.--
       ``(A) Preemption.--A court reviewing any determinations 
     made by the Comptroller regarding preemption of a State law 
     by this title shall assess the validity of such 
     determinations, depending upon the thoroughness evident in 
     the consideration of the agency, the validity of the 
     reasoning of the agency, the consistency with other valid 
     determinations made by the agency, and other factors which 
     the court finds persuasive and relevant to its decision.
       ``(B) Savings clause.--Except as provided in subparagraph 
     (A), nothing in this section shall affect the deference that 
     a court may afford to the Comptroller in making 
     determinations regarding the meaning or interpretation of 
     title LXII of the Revised Statutes of the United States or 
     other Federal laws.
       ``(6) Comptroller determination not delegable.--Any 
     regulation, order, or determination made by the Comptroller 
     of the Currency under paragraph (1)(B) shall be made by the 
     Comptroller, and shall not be delegable to another officer or 
     employee of the Comptroller of the Currency.
       ``(c) Substantial Evidence.--No regulation or order of the 
     Comptroller of the Currency prescribed under subsection 
     (b)(1)(B), shall be interpreted or applied so as to 
     invalidate, or otherwise declare inapplicable to a national 
     bank, the provision of the State consumer financial law, 
     unless substantial evidence, made on the record of the 
     proceeding, supports the specific finding regarding the 
     preemption of such provision in accordance with the legal 
     standard of the decision of the Supreme Court of the United 
     States in Barnett Bank of Marion County, N.A. v. Nelson, 
     Florida Insurance Commissioner, et al., 517 U.S. 25 (1996).
       ``(d) Other Federal Laws.--Notwithstanding any other 
     provision of law, the Comptroller of the Currency may not 
     prescribe a regulation or order pursuant to subsection 
     (b)(1)(B) until the Comptroller of the Currency, after 
     consultation with the Director of the Bureau of Consumer 
     Financial Protection, makes a finding, in writing, that a 
     Federal law provides a substantive standard, applicable to a 
     national bank, which regulates the particular conduct, 
     activity, or authority that is subject to such provision of 
     the State consumer financial law.
       ``(e) Periodic Review of Preemption Determinations.--
       ``(1) In general.--The Comptroller of the Currency shall 
     periodically conduct a review, through notice and public 
     comment, of each determination that a provision of Federal 
     law preempts a State consumer financial law. The agency shall 
     conduct such review within the 5-year period after 
     prescribing or otherwise issuing such determination, and at 
     least once during each 5-year period thereafter. After 
     conducting the review of, and inspecting the comments made 
     on, the determination, the agency shall publish a notice in 
     the Federal Register announcing the decision to continue or 
     rescind the determination or a proposal to amend the 
     determination. Any such notice of a proposal to amend a 
     determination and the subsequent resolution of such proposal 
     shall comply with the procedures set forth in subsections (a) 
     and (b) of section 5244 of the Revised Statutes of the United 
     States (12 U.S.C. 43 (a), (b)).
       ``(2) Reports to congress.--At the time of issuing a review 
     conducted under paragraph (1), the Comptroller of the 
     Currency shall submit a report regarding such review to the 
     Committee on Financial Services of the House of 
     Representatives and the Committee on Banking, Housing, and 
     Urban Affairs of the Senate. The report submitted to the 
     respective committees shall address whether the agency 
     intends to continue, rescind, or propose to amend any 
     determination that a provision of Federal law preempts a 
     State consumer financial law, and the reasons therefor.
       ``(f) Application of State Consumer Financial Law to 
     Subsidiaries and Affiliates.--Notwithstanding any provision 
     of this title, a State consumer financial law shall apply to 
     a subsidiary or affiliate of a national bank (other than a 
     subsidiary or affiliate that is chartered as a national bank) 
     to the same extent that the State consumer financial law 
     applies to any person, corporation, or other entity subject 
     to such State law.
       ``(g) Preservation of Powers Related to Charging 
     Interest.--No provision of this title shall be construed as 
     altering or otherwise affecting the authority conferred by 
     section 5197 of the Revised Statutes of the United States (12 
     U.S.C. 85) for the charging of interest by a national bank at 
     the rate allowed by the laws of the State, territory, or 
     district where the bank is located, including with respect to 
     the meaning of `interest' under such provision.
       ``(h) Transparency of OCC Preemption Determinations.--The 
     Comptroller of the Currency shall publish and update no less 
     frequently than quarterly, a list of preemption 
     determinations by the Comptroller of the Currency then in 
     effect that identifies the activities and practices covered 
     by each determination and the requirements and constraints 
     determined to be preempted.''.
       (b) Clerical Amendment.--The table of sections for chapter 
     one of title LXII of the Revised Statutes of the United 
     States is amended by inserting after the item relating to 
     section 5136B the following new item:

``Sec. 5136C. State law preemption standards for national banks and 
              subsidiaries clarified.''.

     SEC. 1045. CLARIFICATION OF LAW APPLICABLE TO NONDEPOSITORY 
                   INSTITUTION SUBSIDIARIES.

       Section 5136C of the Revised Statutes of the United States 
     (as added by this subtitle) is amended by adding at the end 
     the following:
       ``(i) Clarification of Law Applicable to Nondepository 
     Institution Subsidiaries and Affiliates of National Banks.--
       ``(1) Definitions.--For purposes of this subsection, the 
     terms `depository institution', `subsidiary', and `affiliate' 
     have the same meanings as in section 3 of the Federal Deposit 
     Insurance Act.
       ``(2) Rule of construction.--No provision of this title 
     shall be construed as preempting, annulling, or affecting the 
     applicability of State law to any subsidiary, affiliate, or 
     agent of a national bank (other than

[[Page S3242]]

     a subsidiary, affiliate, or agent that is chartered as a 
     national bank).''.

     SEC. 1046. STATE LAW PREEMPTION STANDARDS FOR FEDERAL SAVINGS 
                   ASSOCIATIONS AND SUBSIDIARIES CLARIFIED.

       (a) In General.--The Home Owners' Loan Act (12 U.S.C. 1461 
     et seq.) is amended by inserting after section 5 the 
     following new section:

     ``SEC. 6. STATE LAW PREEMPTION STANDARDS FOR FEDERAL SAVINGS 
                   ASSOCIATIONS CLARIFIED.

       ``(a) In General.--Any determination by a court or by the 
     Director or any successor officer or agency regarding the 
     relation of State law to a provision of this Act or any 
     regulation or order prescribed under this Act shall be made 
     in accordance with the laws and legal standards applicable to 
     national banks regarding the preemption of State law.
       ``(b) Principles of Conflict Preemption Applicable.--
     Notwithstanding the authorities granted under sections 4 and 
     5, this Act does not occupy the field in any area of State 
     law.''.
       (b) Clerical Amendment.--The table of sections for the Home 
     Owners' Loan Act (12 U.S.C. 1461 et seq.) is amended by 
     striking the item relating to section 6 and inserting the 
     following new item:

    ``Sec. 6.. State law preemption standards for Federal savings 
      associations and subsidiaries clarified.''.

     SEC. 1047. VISITORIAL STANDARDS FOR NATIONAL BANKS AND 
                   SAVINGS ASSOCIATIONS.

       (a) National Banks.--Section 5136C of the Revised Statutes 
     of the United States (as added by this subtitle) is amended 
     by adding at the end the following:
       ``(j) Visitorial Powers.--
       ``(1) In general.--No provision of this title which relates 
     to visitorial powers to which any national bank is subject 
     shall be construed as limiting or restricting the authority 
     of any attorney general (or other chief law enforcement 
     officer) of any State to bring any action in any court of 
     appropriate jurisdiction, as authorized under section 
     5240(a)--
       ``(A) to enforce any applicable provision of Federal or 
     State law, as authorized by such law; or
       ``(B) on behalf of residents of such State, to enforce any 
     applicable provision of any Federal or nonpreempted State law 
     against a national bank, as authorized by such law, or to 
     seek relief for such residents from any violation of any such 
     law by any national bank.
       ``(2) Prior consultation with occ required.--The attorney 
     general (or other chief law enforcement officer) of any State 
     shall consult with the Comptroller of the Currency before 
     acting under paragraph (1).
       ``(k) Enforcement Actions.--The ability of the Comptroller 
     of the Currency to bring an enforcement action under this 
     title or section 5 of the Federal Trade Commission Act does 
     not preclude any private party from enforcing rights granted 
     under Federal or State law in the courts.''.
       (b) Savings Associations.--Section 6 of the Home Owners' 
     Loan Act (as added by this title) is amended by adding at the 
     end the following:
       ``(c) Visitorial Powers.--
       ``(1) In general.--No provision of this Act shall be 
     construed as limiting or restricting the authority of any 
     attorney general (or other chief law enforcement officer) of 
     any State to bring any action in any court of appropriate 
     jurisdiction--
       ``(A) to enforce any applicable provision of Federal or 
     State law, as authorized by such law; or
       ``(B) on behalf of residents of such State, to enforce any 
     applicable provision of any Federal or nonpreempted State law 
     against a Federal savings association, as authorized by such 
     law, or to seek relief for such residents from any violation 
     of any such law by any Federal savings association.
       ``(2) Prior consultation with occ required.--The attorney 
     general (or other chief law enforcement officer) of any State 
     shall consult with the Comptroller of the Currency before 
     acting under paragraph (1).
       ``(d) Enforcement Actions.--The ability of the Comptroller 
     of the Currency to bring an enforcement action under this Act 
     or section 5 of the Federal Trade Commission Act does not 
     preclude any private party from enforcing rights granted 
     under Federal or State law in the courts.''.

     SEC. 1048. EFFECTIVE DATE.

       This subtitle shall become effective on the designated 
     transfer date.

                     Subtitle E--Enforcement Powers

     SEC. 1051. DEFINITIONS.

       For purposes of this subtitle, the following definitions 
     shall apply:
       (1) Bureau investigation.--The term ``Bureau 
     investigation'' means any inquiry conducted by a Bureau 
     investigator for the purpose of ascertaining whether any 
     person is or has been engaged in any conduct that is a 
     violation, as defined in this section.
       (2) Bureau investigator.--The term ``Bureau investigator'' 
     means any attorney or investigator employed by the Bureau who 
     is charged with the duty of enforcing or carrying into effect 
     any Federal consumer financial law.
       (3) Civil investigative demand and demand.--The terms 
     ``civil investigative demand'' and ``demand'' mean any demand 
     issued by the Bureau.
       (4) Custodian.--The term ``custodian'' means the custodian 
     or any deputy custodian designated by the Bureau.
       (5) Documentary material.--The term ``documentary 
     material'' includes the original or any copy of any book, 
     document, record, report, memorandum, paper, communication, 
     tabulation, chart, logs, electronic files, or other data or 
     data compilations stored in any medium.
       (6) Violation.--The term ``violation'' means any act or 
     omission that, if proved, would constitute a violation of any 
     provision of Federal consumer financial law.

     SEC. 1052. INVESTIGATIONS AND ADMINISTRATIVE DISCOVERY.

       (a) Joint Investigations.--
       (1) In general.--The Bureau or, where appropriate, a Bureau 
     investigator, may engage in joint investigations and requests 
     for information, as authorized under this title.
       (2) Fair lending.--The authority under paragraph (1) 
     includes matters relating to fair lending, and where 
     appropriate, joint investigations with, and requests for 
     information from, the Secretary of Housing and Urban 
     Development, the Attorney General of the United States, or 
     both.
       (b) Subpoenas.--
       (1) In general.--The Bureau or a Bureau investigator may 
     issue subpoenas for the attendance and testimony of witnesses 
     and the production of relevant papers, books, documents, or 
     other material in connection with hearings under this title.
       (2) Failure to obey.--In the case of contumacy or refusal 
     to obey a subpoena issued pursuant to this paragraph and 
     served upon any person, the district court of the United 
     States for any district in which such person is found, 
     resides, or transacts business, upon application by the 
     Bureau or a Bureau investigator and after notice to such 
     person, may issue an order requiring such person to appear 
     and give testimony or to appear and produce documents or 
     other material.
       (3) Contempt.--Any failure to obey an order of the court 
     under this subsection may be punished by the court as a 
     contempt thereof.
       (c) Demands.--
       (1) In general.--Whenever the Bureau has reason to believe 
     that any person may be in possession, custody, or control of 
     any documentary material or tangible things, or may have any 
     information, relevant to a violation, the Bureau may, before 
     the institution of any proceedings under the Federal consumer 
     financial law, issue in writing, and cause to be served upon 
     such person, a civil investigative demand requiring such 
     person to--
       (A) produce such documentary material for inspection and 
     copying or reproduction in the form or medium requested by 
     the Bureau;
       (B) submit such tangible things;
       (C) file written reports or answers to questions;
       (D) give oral testimony concerning documentary material, 
     tangible things, or other information; or
       (E) furnish any combination of such material, answers, or 
     testimony.
       (2) Requirements.--Each civil investigative demand shall 
     state the nature of the conduct constituting the alleged 
     violation which is under investigation and the provision of 
     law applicable to such violation.
       (3) Production of documents.--Each civil investigative 
     demand for the production of documentary material shall--
       (A) describe each class of documentary material to be 
     produced under the demand with such definiteness and 
     certainty as to permit such material to be fairly identified;
       (B) prescribe a return date or dates which will provide a 
     reasonable period of time within which the material so 
     demanded may be assembled and made available for inspection 
     and copying or reproduction; and
       (C) identify the custodian to whom such material shall be 
     made available.
       (4) Production of things.--Each civil investigative demand 
     for the submission of tangible things shall--
       (A) describe each class of tangible things to be submitted 
     under the demand with such definiteness and certainty as to 
     permit such things to be fairly identified;
       (B) prescribe a return date or dates which will provide a 
     reasonable period of time within which the things so demanded 
     may be assembled and submitted; and
       (C) identify the custodian to whom such things shall be 
     submitted.
       (5) Demand for written reports or answers.--Each civil 
     investigative demand for written reports or answers to 
     questions shall--
       (A) propound with definiteness and certainty the reports to 
     be produced or the questions to be answered;
       (B) prescribe a date or dates at which time written reports 
     or answers to questions shall be submitted; and
       (C) identify the custodian to whom such reports or answers 
     shall be submitted.
       (6) Oral testimony.--Each civil investigative demand for 
     the giving of oral testimony shall--
       (A) prescribe a date, time, and place at which oral 
     testimony shall be commenced; and
       (B) identify a Bureau investigator who shall conduct the 
     investigation and the custodian to whom the transcript of 
     such investigation shall be submitted.
       (7) Service.--Any civil investigative demand and any 
     enforcement petition filed under this section may be served--
       (A) by any Bureau investigator at any place within the 
     territorial jurisdiction of any court of the United States; 
     and

[[Page S3243]]

       (B) upon any person who is not found within the territorial 
     jurisdiction of any court of the United States--
       (i) in such manner as the Federal Rules of Civil Procedure 
     prescribe for service in a foreign nation; and
       (ii) to the extent that the courts of the United States 
     have authority to assert jurisdiction over such person, 
     consistent with due process, the United States District Court 
     for the District of Columbia shall have the same jurisdiction 
     to take any action respecting compliance with this section by 
     such person that such district court would have if such 
     person were personally within the jurisdiction of such 
     district court.
       (8) Method of service.--Service of any civil investigative 
     demand or any enforcement petition filed under this section 
     may be made upon a person, including any legal entity, by--
       (A) delivering a duly executed copy of such demand or 
     petition to the individual or to any partner, executive 
     officer, managing agent, or general agent of such person, or 
     to any agent of such person authorized by appointment or by 
     law to receive service of process on behalf of such person;
       (B) delivering a duly executed copy of such demand or 
     petition to the principal office or place of business of the 
     person to be served; or
       (C) depositing a duly executed copy in the United States 
     mails, by registered or certified mail, return receipt 
     requested, duly addressed to such person at the principal 
     office or place of business of such person.
       (9) Proof of service.--
       (A) In general.--A verified return by the individual 
     serving any civil investigative demand or any enforcement 
     petition filed under this section setting forth the manner of 
     such service shall be proof of such service.
       (B) Return receipts.--In the case of service by registered 
     or certified mail, such return shall be accompanied by the 
     return post office receipt of delivery of such demand or 
     enforcement petition.
       (10) Production of documentary material.--The production of 
     documentary material in response to a civil investigative 
     demand shall be made under a sworn certificate, in such form 
     as the demand designates, by the person, if a natural person, 
     to whom the demand is directed or, if not a natural person, 
     by any person having knowledge of the facts and circumstances 
     relating to such production, to the effect that all of the 
     documentary material required by the demand and in the 
     possession, custody, or control of the person to whom the 
     demand is directed has been produced and made available to 
     the custodian.
       (11) Submission of tangible things.--The submission of 
     tangible things in response to a civil investigative demand 
     shall be made under a sworn certificate, in such form as the 
     demand designates, by the person to whom the demand is 
     directed or, if not a natural person, by any person having 
     knowledge of the facts and circumstances relating to such 
     production, to the effect that all of the tangible things 
     required by the demand and in the possession, custody, or 
     control of the person to whom the demand is directed have 
     been submitted to the custodian.
       (12) Separate answers.--Each reporting requirement or 
     question in a civil investigative demand shall be answered 
     separately and fully in writing under oath, unless it is 
     objected to, in which event the reasons for the objection 
     shall be stated in lieu of an answer, and it shall be 
     submitted under a sworn certificate, in such form as the 
     demand designates, by the person, if a natural person, to 
     whom the demand is directed or, if not a natural person, by 
     any person responsible for answering each reporting 
     requirement or question, to the effect that all information 
     required by the demand and in the possession, custody, 
     control, or knowledge of the person to whom the demand is 
     directed has been submitted.
       (13) Testimony.--
       (A) In general.--
       (i) Oath or affirmation.--Any Bureau investigator before 
     whom oral testimony is to be taken shall put the witness 
     under oath or affirmation, and shall personally, or by any 
     individual acting under the direction of and in the presence 
     of the Bureau investigator, record the testimony of the 
     witness.
       (ii) Transcription.--The testimony shall be taken 
     stenographically and transcribed.
       (iii) Transmission to custodian.--After the testimony is 
     fully transcribed, the Bureau investigator before whom the 
     testimony is taken shall promptly transmit a copy of the 
     transcript of the testimony to the custodian.
       (B) Parties present.--Any Bureau investigator before whom 
     oral testimony is to be taken shall exclude from the place 
     where the testimony is to be taken all other persons, except 
     the person giving the testimony, the attorney of that person, 
     the officer before whom the testimony is to be taken, and any 
     stenographer taking such testimony.
       (C) Location.--The oral testimony of any person taken 
     pursuant to a civil investigative demand shall be taken in 
     the judicial district of the United States in which such 
     person resides, is found, or transacts business, or in such 
     other place as may be agreed upon by the Bureau investigator 
     before whom the oral testimony of such person is to be taken 
     and such person.
       (D) Attorney representation.--
       (i) In general.--Any person compelled to appear under a 
     civil investigative demand for oral testimony pursuant to 
     this section may be accompanied, represented, and advised by 
     an attorney.
       (ii) Authority.--The attorney may advise a person described 
     in clause (i), in confidence, either upon the request of such 
     person or upon the initiative of the attorney, with respect 
     to any question asked of such person.
       (iii) Objections.--A person described in clause (i), or the 
     attorney for that person, may object on the record to any 
     question, in whole or in part, and such person shall briefly 
     state for the record the reason for the objection. An 
     objection may properly be made, received, and entered upon 
     the record when it is claimed that such person is entitled to 
     refuse to answer the question on grounds of any 
     constitutional or other legal right or privilege, including 
     the privilege against self-incrimination, but such person 
     shall not otherwise object to or refuse to answer any 
     question, and such person or attorney shall not otherwise 
     interrupt the oral examination.
       (iv) Refusal to answer.--If a person described in clause 
     (i) refuses to answer any question--

       (I) the Bureau may petition the district court of the 
     United States pursuant to this section for an order 
     compelling such person to answer such question; and
       (II) on grounds of the privilege against self-
     incrimination, the testimony of such person may be compelled 
     in accordance with the provisions of section 6004 of title 
     18, United States Code.

       (E) Transcripts.--For purposes of this subsection--
       (i) after the testimony of any witness is fully 
     transcribed, the Bureau investigator shall afford the witness 
     (who may be accompanied by an attorney) a reasonable 
     opportunity to examine the transcript;
       (ii) the transcript shall be read to or by the witness, 
     unless such examination and reading are waived by the 
     witness;
       (iii) any changes in form or substance which the witness 
     desires to make shall be entered and identified upon the 
     transcript by the Bureau investigator, with a statement of 
     the reasons given by the witness for making such changes;
       (iv) the transcript shall be signed by the witness, unless 
     the witness in writing waives the signing, is ill, cannot be 
     found, or refuses to sign; and
       (v) if the transcript is not signed by the witness during 
     the 30-day period following the date on which the witness is 
     first afforded a reasonable opportunity to examine the 
     transcript, the Bureau investigator shall sign the transcript 
     and state on the record the fact of the waiver, illness, 
     absence of the witness, or the refusal to sign, together with 
     any reasons given for the failure to sign.
       (F) Certification by investigator.--The Bureau investigator 
     shall certify on the transcript that the witness was duly 
     sworn by him or her and that the transcript is a true record 
     of the testimony given by the witness, and the Bureau 
     investigator shall promptly deliver the transcript or send it 
     by registered or certified mail to the custodian.
       (G) Copy of transcript.--The Bureau investigator shall 
     furnish a copy of the transcript (upon payment of reasonable 
     charges for the transcript) to the witness only, except that 
     the Bureau may for good cause limit such witness to 
     inspection of the official transcript of his testimony.
       (H) Witness fees.--Any witness appearing for the taking of 
     oral testimony pursuant to a civil investigative demand shall 
     be entitled to the same fees and mileage which are paid to 
     witnesses in the district courts of the United States.
       (d) Confidential Treatment of Demand Material.--
       (1) In general.--Documentary materials and tangible things 
     received as a result of a civil investigative demand shall be 
     subject to requirements and procedures regarding 
     confidentiality, in accordance with rules established by the 
     Bureau.
       (2) Disclosure to congress.--No rule established by the 
     Bureau regarding the confidentiality of materials submitted 
     to, or otherwise obtained by, the Bureau shall be intended to 
     prevent disclosure to either House of Congress or to an 
     appropriate committee of the Congress, except that the Bureau 
     is permitted to adopt rules allowing prior notice to any 
     party that owns or otherwise provided the material to the 
     Bureau and had designated such material as confidential.
       (e) Petition for Enforcement.--
       (1) In general.--Whenever any person fails to comply with 
     any civil investigative demand duly served upon him under 
     this section, or whenever satisfactory copying or 
     reproduction of material requested pursuant to the demand 
     cannot be accomplished and such person refuses to surrender 
     such material, the Bureau, through such officers or attorneys 
     as it may designate, may file, in the district court of the 
     United States for any judicial district in which such person 
     resides, is found, or transacts business, and serve upon such 
     person, a petition for an order of such court for the 
     enforcement of this section.
       (2) Service of process.--All process of any court to which 
     application may be made as provided in this subsection may be 
     served in any judicial district.
       (f) Petition for Order Modifying or Setting Aside Demand.--
       (1) In general.--Not later than 20 days after the service 
     of any civil investigative demand upon any person under 
     subsection

[[Page S3244]]

     (b), or at any time before the return date specified in the 
     demand, whichever period is shorter, or within such period 
     exceeding 20 days after service or in excess of such return 
     date as may be prescribed in writing, subsequent to service, 
     by any Bureau investigator named in the demand, such person 
     may file with the Bureau a petition for an order by the 
     Bureau modifying or setting aside the demand.
       (2) Compliance during pendency.--The time permitted for 
     compliance with the demand in whole or in part, as determined 
     proper and ordered by the Bureau, shall not run during the 
     pendency of a petition under paragraph (1) at the Bureau, 
     except that such person shall comply with any portions of the 
     demand not sought to be modified or set aside.
       (3) Specific grounds.--A petition under paragraph (1) shall 
     specify each ground upon which the petitioner relies in 
     seeking relief, and may be based upon any failure of the 
     demand to comply with the provisions of this section, or upon 
     any constitutional or other legal right or privilege of such 
     person.
       (g) Custodial Control.--At any time during which any 
     custodian is in custody or control of any documentary 
     material, tangible things, reports, answers to questions, or 
     transcripts of oral testimony given by any person in 
     compliance with any civil investigative demand, such person 
     may file, in the district court of the United States for the 
     judicial district within which the office of such custodian 
     is situated, and serve upon such custodian, a petition for an 
     order of such court requiring the performance by such 
     custodian of any duty imposed upon him by this section or 
     rule promulgated by the Bureau.
       (h) Jurisdiction of Court.--
       (1) In general.--Whenever any petition is filed in any 
     district court of the United States under this section, such 
     court shall have jurisdiction to hear and determine the 
     matter so presented, and to enter such order or orders as may 
     be required to carry out the provisions of this section.
       (2) Appeal.--Any final order entered as described in 
     paragraph (1) shall be subject to appeal pursuant to section 
     1291 of title 28, United States Code.

     SEC. 1053. HEARINGS AND ADJUDICATION PROCEEDINGS.

       (a) In General.--The Bureau is authorized to conduct 
     hearings and adjudication proceedings with respect to any 
     person in the manner prescribed by chapter 5 of title 5, 
     United States Code in order to ensure or enforce compliance 
     with--
       (1) the provisions of this title, including any rules 
     prescribed by the Bureau under this title; and
       (2) any other Federal law that the Bureau is authorized to 
     enforce, including an enumerated consumer law, and any 
     regulations or order prescribed thereunder, unless such 
     Federal law specifically limits the Bureau from conducting a 
     hearing or adjudication proceeding and only to the extent of 
     such limitation.
       (b) Special Rules for Cease-and-Desist Proceedings.--
       (1) Orders authorized.--
       (A) In general.--If, in the opinion of the Bureau, any 
     covered person or service provider is engaging or has engaged 
     in an activity that violates a law, rule, or any condition 
     imposed in writing on the person by the Bureau, the Bureau 
     may, subject to sections 1024, 1025, and 1026, issue and 
     serve upon the covered person or service provider a notice of 
     charges in respect thereof.
       (B) Content of notice.--The notice under subparagraph (A) 
     shall contain a statement of the facts constituting the 
     alleged violation or violations, and shall fix a time and 
     place at which a hearing will be held to determine whether an 
     order to cease and desist should issue against the covered 
     person or service provider, such hearing to be held not 
     earlier than 30 days nor later than 60 days after the date of 
     service of such notice, unless an earlier or a later date is 
     set by the Bureau, at the request of any party so served.
       (C) Consent.--Unless the party or parties served under 
     subparagraph (B) appear at the hearing personally or by a 
     duly authorized representative, such person shall be deemed 
     to have consented to the issuance of the cease-and-desist 
     order.
       (D) Procedure.--In the event of consent under subparagraph 
     (C), or if, upon the record, made at any such hearing, the 
     Bureau finds that any violation specified in the notice of 
     charges has been established, the Bureau may issue and serve 
     upon the covered person or service provider an order to cease 
     and desist from the violation or practice. Such order may, by 
     provisions which may be mandatory or otherwise, require the 
     covered person or service provider to cease and desist from 
     the subject activity, and to take affirmative action to 
     correct the conditions resulting from any such violation.
       (2) Effectiveness of order.--A cease-and-desist order shall 
     become effective at the expiration of 30 days after the date 
     of service of an order under paragraph (1) upon the covered 
     person or service provider concerned (except in the case of a 
     cease-and-desist order issued upon consent, which shall 
     become effective at the time specified therein), and shall 
     remain effective and enforceable as provided therein, except 
     to such extent as the order is stayed, modified, terminated, 
     or set aside by action of the Bureau or a reviewing court.
       (3) Decision and appeal.--Any hearing provided for in this 
     subsection shall be held in the Federal judicial district or 
     in the territory in which the residence or principal office 
     or place of business of the person is located unless the 
     person consents to another place, and shall be conducted in 
     accordance with the provisions of chapter 5 of title 5 of the 
     United States Code. After such hearing, and within 90 days 
     after the Bureau has notified the parties that the case has 
     been submitted to the Bureau for final decision, the Bureau 
     shall render its decision (which shall include findings of 
     fact upon which its decision is predicated) and shall issue 
     and serve upon each party to the proceeding an order or 
     orders consistent with the provisions of this section. 
     Judicial review of any such order shall be exclusively as 
     provided in this subsection. Unless a petition for review is 
     timely filed in a court of appeals of the United States, as 
     provided in paragraph (4), and thereafter until the record in 
     the proceeding has been filed as provided in paragraph (4), 
     the Bureau may at any time, upon such notice and in such 
     manner as the Bureau shall determine proper, modify, 
     terminate, or set aside any such order. Upon filing of the 
     record as provided, the Bureau may modify, terminate, or set 
     aside any such order with permission of the court.
       (4) Appeal to court of appeals.--Any party to any 
     proceeding under this subsection may obtain a review of any 
     order served pursuant to this subsection (other than an order 
     issued with the consent of the person concerned) by the 
     filing in the court of appeals of the United States for the 
     circuit in which the principal office of the covered person 
     is located, or in the United States Court of Appeals for the 
     District of Columbia Circuit, within 30 days after the date 
     of service of such order, a written petition praying that the 
     order of the Bureau be modified, terminated, or set aside. A 
     copy of such petition shall be forthwith transmitted by the 
     clerk of the court to the Bureau, and thereupon the Bureau 
     shall file in the court the record in the proceeding, as 
     provided in section 2112 of title 28 of the United States 
     Code. Upon the filing of such petition, such court shall have 
     jurisdiction, which upon the filing of the record shall 
     except as provided in the last sentence of paragraph (3) be 
     exclusive, to affirm, modify, terminate, or set aside, in 
     whole or in part, the order of the Bureau. Review of such 
     proceedings shall be had as provided in chapter 7 of title 5 
     of the United States Code. The judgment and decree of the 
     court shall be final, except that the same shall be subject 
     to review by the Supreme Court of the United States, upon 
     certiorari, as provided in section 1254 of title 28 of the 
     United States Code.
       (5) No stay.--The commencement of proceedings for judicial 
     review under paragraph (4) shall not, unless specifically 
     ordered by the court, operate as a stay of any order issued 
     by the Bureau.
       (c) Special Rules for Temporary Cease-and-Desist 
     Proceedings.--
       (1) In general.--Whenever the Bureau determines that the 
     violation specified in the notice of charges served upon a 
     person, including a service provider, pursuant to subsection 
     (b), or the continuation thereof, is likely to cause the 
     person to be insolvent or otherwise prejudice the interests 
     of consumers before the completion of the proceedings 
     conducted pursuant to subsection (b), the Bureau may issue a 
     temporary order requiring the person to cease and desist from 
     any such violation or practice and to take affirmative action 
     to prevent or remedy such insolvency or other condition 
     pending completion of such proceedings. Such order may 
     include any requirement authorized under this subtitle. Such 
     order shall become effective upon service upon the person 
     and, unless set aside, limited, or suspended by a court in 
     proceedings authorized by paragraph (2), shall remain 
     effective and enforceable pending the completion of the 
     administrative proceedings pursuant to such notice and until 
     such time as the Bureau shall dismiss the charges specified 
     in such notice, or if a cease-and-desist order is issued 
     against the person, until the effective date of such order.
       (2) Appeal.--Not later than 10 days after the covered 
     person or service provider concerned has been served with a 
     temporary cease-and-desist order, the person may apply to the 
     United States district court for the judicial district in 
     which the residence or principal office or place of business 
     of the person is located, or the United States District Court 
     for the District of Columbia, for an injunction setting 
     aside, limiting, or suspending the enforcement, operation, or 
     effectiveness of such order pending the completion of the 
     administrative proceedings pursuant to the notice of charges 
     served upon the person under subsection (b), and such court 
     shall have jurisdiction to issue such injunction.
       (3) Incomplete or inaccurate records.--
       (A) Temporary order.--If a notice of charges served under 
     subsection (b) specifies, on the basis of particular facts 
     and circumstances, that the books and records of a covered 
     person or service provider are so incomplete or inaccurate 
     that the Bureau is unable to determine the financial 
     condition of that person or the details or purpose of any 
     transaction or transactions that may have a material effect 
     on the financial condition of that person, the Bureau may 
     issue a temporary order requiring--
       (i) the cessation of any activity or practice which gave 
     rise, whether in whole or in part, to the incomplete or 
     inaccurate state of the books or records; or
       (ii) affirmative action to restore such books or records to 
     a complete and accurate

[[Page S3245]]

     state, until the completion of the proceedings under 
     subsection (b)(1).
       (B) Effective period.--Any temporary order issued under 
     subparagraph (A)--
       (i) shall become effective upon service; and
       (ii) unless set aside, limited, or suspended by a court in 
     proceedings under paragraph (2), shall remain in effect and 
     enforceable until the earlier of--

       (I) the completion of the proceeding initiated under 
     subsection (b) in connection with the notice of charges; or
       (II) the date the Bureau determines, by examination or 
     otherwise, that the books and records of the covered person 
     or service provider are accurate and reflect the financial 
     condition thereof.

       (d) Special Rules for Enforcement of Orders.--
       (1) In general.--The Bureau may in its discretion apply to 
     the United States district court within the jurisdiction of 
     which the principal office or place of business of the person 
     is located, for the enforcement of any effective and 
     outstanding notice or order issued under this section, and 
     such court shall have jurisdiction and power to order and 
     require compliance herewith.
       (2) Exception.--Except as otherwise provided in this 
     subsection, no court shall have jurisdiction to affect by 
     injunction or otherwise the issuance or enforcement of any 
     notice or order or to review, modify, suspend, terminate, or 
     set aside any such notice or order.
       (e) Rules.--The Bureau shall prescribe rules establishing 
     such procedures as may be necessary to carry out this 
     section.

     SEC. 1054. LITIGATION AUTHORITY.

       (a) In General.--If any person violates a Federal consumer 
     financial law, the Bureau may, subject to sections 1024, 
     1025, and 1026, commence a civil action against such person 
     to impose a civil penalty or to seek all appropriate legal 
     and equitable relief including a permanent or temporary 
     injunction as permitted by law.
       (b) Representation.--The Bureau may act in its own name and 
     through its own attorneys in enforcing any provision of this 
     title, rules thereunder, or any other law or regulation, or 
     in any action, suit, or proceeding to which the Bureau is a 
     party.
       (c) Compromise of Actions.--The Bureau may compromise or 
     settle any action if such compromise is approved by the 
     court.
       (d) Notice to the Attorney General.--When commencing a 
     civil action under Federal consumer financial law, or any 
     rule thereunder, the Bureau shall notify the Attorney General 
     and, with respect to a civil action against an insured 
     depository institution or insured credit union, the 
     appropriate prudential regulator.
       (e) Appearance Before the Supreme Court.--The Bureau may 
     represent itself in its own name before the Supreme Court of 
     the United States, provided that the Bureau makes a written 
     request to the Attorney General within the 10-day period 
     which begins on the date of entry of the judgment which would 
     permit any party to file a petition for writ of certiorari, 
     and the Attorney General concurs with such request or fails 
     to take action within 60 days of the request of the Bureau.
       (f) Forum.--Any civil action brought under this title may 
     be brought in a United States district court or in any court 
     of competent jurisdiction of a state in a district in which 
     the defendant is located or resides or is doing business, and 
     such court shall have jurisdiction to enjoin such person and 
     to require compliance with any Federal consumer financial 
     law.
       (g) Time for Bringing Action.--
       (1) In general.--Except as otherwise permitted by law or 
     equity, no action may be brought under this title more than 3 
     years after the date of discovery of the violation to which 
     an action relates.
       (2) Limitations under other federal laws.--
       (A) In general.--For purposes of this subsection, an action 
     arising under this title does not include claims arising 
     solely under enumerated consumer laws.
       (B) Bureau authority.--In any action arising solely under 
     an enumerated consumer law, the Bureau may commence, defend, 
     or intervene in the action in accordance with the 
     requirements of that provision of law, as applicable.
       (C) Transferred authority.--In any action arising solely 
     under laws for which authorities were transferred under 
     subtitles F and H, the Bureau may commence, defend, or 
     intervene in the action in accordance with the requirements 
     of that provision of law, as applicable.

     SEC. 1055. RELIEF AVAILABLE.

       (a) Administrative Proceedings or Court Actions.--
       (1) Jurisdiction.--The court (or the Bureau, as the case 
     may be) in an action or adjudication proceeding brought under 
     Federal consumer financial law, shall have jurisdiction to 
     grant any appropriate legal or equitable relief with respect 
     to a violation of Federal consumer financial law, including a 
     violation of a rule or order prescribed under a Federal 
     consumer financial law.
       (2) Relief.--Relief under this section may include, without 
     limitation--
       (A) rescission or reformation of contracts;
       (B) refund of moneys or return of real property;
       (C) restitution;
       (D) disgorgement or compensation for unjust enrichment;
       (E) payment of damages or other monetary relief;
       (F) public notification regarding the violation, including 
     the costs of notification;
       (G) limits on the activities or functions of the person; 
     and
       (H) civil money penalties, as set forth more fully in 
     subsection (c).
       (3) No exemplary or punitive damages.--Nothing in this 
     subsection shall be construed as authorizing the imposition 
     of exemplary or punitive damages.
       (b) Recovery of Costs.--In any action brought by the 
     Bureau, a State attorney general, or any State regulator to 
     enforce any Federal consumer financial law, the Bureau, the 
     State attorney general, or the State regulator may recover 
     its costs in connection with prosecuting such action if the 
     Bureau, the State attorney general, or the State regulator is 
     the prevailing party in the action.
       (c) Civil Money Penalty in Court and Administrative 
     Actions.--
       (1) In general.--Any person that violates, through any act 
     or omission, any provision of Federal consumer financial law 
     shall forfeit and pay a civil penalty pursuant to this 
     subsection.
       (2) Penalty amounts.--
       (A) First tier.--For any violation of a law, rule, or final 
     order or condition imposed in writing by the Bureau, a civil 
     penalty may not exceed $5,000 for each day during which such 
     violation or failure to pay continues.
       (B) Second tier.--Notwithstanding paragraph (A), for any 
     person that recklessly engages in a violation of a Federal 
     consumer financial law, a civil penalty may not exceed 
     $25,000 for each day during which such violation continues.
       (C) Third tier.--Notwithstanding subparagraphs (A) and (B), 
     for any person that knowingly violates a Federal consumer 
     financial law, a civil penalty may not exceed $1,000,000 for 
     each day during which such violation continues.
       (3) Mitigating factors.--In determining the amount of any 
     penalty assessed under paragraph (2), the Bureau or the court 
     shall take into account the appropriateness of the penalty 
     with respect to--
       (A) the size of financial resources and good faith of the 
     person charged;
       (B) the gravity of the violation or failure to pay;
       (C) the severity of the risks to or losses of the consumer, 
     which may take into account the number of products or 
     services sold or provided;
       (D) the history of previous violations; and
       (E) such other matters as justice may require.
       (4) Authority to modify or remit penalty.--The Bureau may 
     compromise, modify, or remit any penalty which may be 
     assessed or had already been assessed under paragraph (2). 
     The amount of such penalty, when finally determined, shall be 
     exclusive of any sums owed by the person to the United States 
     in connection with the costs of the proceeding, and may be 
     deducted from any sums owing by the United States to the 
     person charged.
       (5) Notice and hearing.--No civil penalty may be assessed 
     under this subsection with respect to a violation of any 
     Federal consumer financial law, unless--
       (A) the Bureau gives notice and an opportunity for a 
     hearing to the person accused of the violation; or
       (B) the appropriate court has ordered such assessment and 
     entered judgment in favor of the Bureau.

     SEC. 1056. REFERRALS FOR CRIMINAL PROCEEDINGS.

       If the Bureau obtains evidence that any person, domestic or 
     foreign, has engaged in conduct that may constitute a 
     violation of Federal criminal law, the Bureau shall have the 
     power to transmit such evidence to the Attorney General of 
     the United States, who may institute criminal proceedings 
     under appropriate law. Nothing in this section affects any 
     other authority of the Bureau to disclose information.

     SEC. 1057. EMPLOYEE PROTECTION.

       (a) In General.--No covered person or service provider 
     shall terminate or in any other way discriminate against, or 
     cause to be terminated or discriminated against, any covered 
     employee or any authorized representative of covered 
     employees by reason of the fact that such employee or 
     representative, whether at the initiative of the employee or 
     in the ordinary course of the duties of the employee (or any 
     person acting pursuant to a request of the employee), has--
       (1) provided, caused to be provided, or is about to provide 
     or cause to be provided, information to the employer, the 
     Bureau, or any other State, local, or Federal, government 
     authority or law enforcement agency relating to any violation 
     of, or any act or omission that the employee reasonably 
     believes to be a violation of, any provision of this title or 
     any other provision of law that is subject to the 
     jurisdiction of the Bureau, or any rule, order, standard, or 
     prohibition prescribed by the Bureau;
       (2) testified or will testify in any proceeding resulting 
     from the administration or enforcement of any provision of 
     this title or any other provision of law that is subject to 
     the jurisdiction of the Bureau, or any rule, order, standard, 
     or prohibition prescribed by the Bureau;
       (3) filed, instituted, or caused to be filed or instituted 
     any proceeding under any Federal consumer financial law; or
       (4) objected to, or refused to participate in, any 
     activity, policy, practice, or assigned task that the 
     employee (or other such person) reasonably believed to be in 
     violation of

[[Page S3246]]

     any law, rule, order, standard, or prohibition, subject to 
     the jurisdiction of, or enforceable by, the Bureau.
       (b) Definition of Covered Employee.--For the purposes of 
     this section, the term ``covered employee'' means any 
     individual performing tasks related to the offering or 
     provision of a consumer financial product or service.
       (c) Procedures and Timetables.--
       (1) Complaint.--
       (A) In general.--A person who believes that he or she has 
     been discharged or otherwise discriminated against by any 
     person in violation of subsection (a) may, not later than 180 
     days after the date on which such alleged violation occurs, 
     file (or have any person file on his or her behalf) a 
     complaint with the Secretary of Labor alleging such discharge 
     or discrimination and identifying the person responsible for 
     such act.
       (B) Actions of secretary of labor.--Upon receipt of such a 
     complaint, the Secretary of Labor shall notify, in writing, 
     the person named in the complaint who is alleged to have 
     committed the violation, of --
       (i) the filing of the complaint;
       (ii) the allegations contained in the complaint;
       (iii) the substance of evidence supporting the complaint; 
     and
       (iv) opportunities that will be afforded to such person 
     under paragraph (2).
       (2) Investigation by secretary of labor.--
       (A) In general.--Not later than 60 days after the date of 
     receipt of a complaint filed under paragraph (1), and after 
     affording the complainant and the person named in the 
     complaint who is alleged to have committed the violation that 
     is the basis for the complaint an opportunity to submit to 
     the Secretary of Labor a written response to the complaint 
     and an opportunity to meet with a representative of the 
     Secretary of Labor to present statements from witnesses, the 
     Secretary of Labor shall--
       (i) initiate an investigation and determine whether there 
     is reasonable cause to believe that the complaint has merit; 
     and
       (ii) notify the complainant and the person alleged to have 
     committed the violation of subsection (a), in writing, of 
     such determination.
       (B) Notice of relief available.--If the Secretary of Labor 
     concludes that there is reasonable cause to believe that a 
     violation of subsection (a) has occurred, the Secretary of 
     Labor shall, together with the notice under subparagraph 
     (A)(ii), issue a preliminary order providing the relief 
     prescribed by paragraph (4)(B).
       (C) Request for hearing.--Not later than 30 days after the 
     date of receipt of notification of a determination of the 
     Secretary of Labor under this paragraph, either the person 
     alleged to have committed the violation or the complainant 
     may file objections to the findings or preliminary order, or 
     both, and request a hearing on the record. The filing of such 
     objections shall not operate to stay any reinstatement remedy 
     contained in the preliminary order. Any such hearing shall be 
     conducted expeditiously, and if a hearing is not requested in 
     such 30-day period, the preliminary order shall be deemed a 
     final order that is not subject to judicial review.
       (3) Grounds for determination of complaints.--
       (A) In general.--The Secretary of Labor shall dismiss a 
     complaint filed under this subsection, and shall not conduct 
     an investigation otherwise required under paragraph (2), 
     unless the complainant makes a prima facie showing that any 
     behavior described in paragraphs (1) through (4) of 
     subsection (a) was a contributing factor in the unfavorable 
     personnel action alleged in the complaint.
       (B) Rebuttal evidence.--Notwithstanding a finding by the 
     Secretary of Labor that the complainant has made the showing 
     required under subparagraph (A), no investigation otherwise 
     required under paragraph (2) shall be conducted, if the 
     employer demonstrates, by clear and convincing evidence, that 
     the employer would have taken the same unfavorable personnel 
     action in the absence of that behavior.
       (C) Evidentiary standards.--The Secretary of Labor may 
     determine that a violation of subsection (a) has occurred 
     only if the complainant demonstrates that any behavior 
     described in paragraphs (1) through (4) of subsection (a) was 
     a contributing factor in the unfavorable personnel action 
     alleged in the complaint. Relief may not be ordered under 
     subparagraph (A) if the employer demonstrates by clear and 
     convincing evidence that the employer would have taken the 
     same unfavorable personnel action in the absence of that 
     behavior.
       (4) Issuance of final orders; review procedures.--
       (A) Timing.--Not later than 120 days after the date of 
     conclusion of any hearing under paragraph (2), the Secretary 
     of Labor shall issue a final order providing the relief 
     prescribed by this paragraph or denying the complaint. At any 
     time before issuance of a final order, a proceeding under 
     this subsection may be terminated on the basis of a 
     settlement agreement entered into by the Secretary of Labor, 
     the complainant, and the person alleged to have committed the 
     violation.
       (B) Penalties.--
       (i) Order of secretary of labor.--If, in response to a 
     complaint filed under paragraph (1), the Secretary of Labor 
     determines that a violation of subsection (a) has occurred, 
     the Secretary of Labor shall order the person who committed 
     such violation--

       (I) to take affirmative action to abate the violation;
       (II) to reinstate the complainant to his or her former 
     position, together with compensation (including back pay) and 
     restore the terms, conditions, and privileges associated with 
     his or her employment; and
       (III) to provide compensatory damages to the complainant.

       (ii) Penalty.--If an order is issued under clause (i), the 
     Secretary of Labor, at the request of the complainant, shall 
     assess against the person against whom the order is issued, a 
     sum equal to the aggregate amount of all costs and expenses 
     (including attorney fees and expert witness fees) reasonably 
     incurred, as determined by the Secretary of Labor, by the 
     complainant for, or in connection with, the bringing of the 
     complaint upon which the order was issued.
       (C) Penalty for frivolous claims.--If the Secretary of 
     Labor finds that a complaint under paragraph (1) is frivolous 
     or has been brought in bad faith, the Secretary of Labor may 
     award to the prevailing employer a reasonable attorney fee, 
     not exceeding $1,000, to be paid by the complainant.
       (D) De novo review.--
       (i) Failure of the secretary to act.--If the Secretary of 
     Labor has not issued a final order within 210 days after the 
     date of filing of a complaint under this subsection, or 
     within 90 days after the date of receipt of a written 
     determination, the complainant may bring an action at law or 
     equity for de novo review in the appropriate district court 
     of the United States having jurisdiction, which shall have 
     jurisdiction over such an action without regard to the amount 
     in controversy, and which action shall, at the request of 
     either party to such action, be tried by the court with a 
     jury.
       (ii) Procedures.--A proceeding under clause (i) shall be 
     governed by the same legal burdens of proof specified in 
     paragraph (3). The court shall have jurisdiction to grant all 
     relief necessary to make the employee whole, including 
     injunctive relief and compensatory damages, including--

       (I) reinstatement with the same seniority status that the 
     employee would have had, but for the discharge or 
     discrimination;
       (II) the amount of back pay, with interest; and
       (III) compensation for any special damages sustained as a 
     result of the discharge or discrimination, including 
     litigation costs, expert witness fees, and reasonable 
     attorney fees.

       (E) Other appeals.--Unless the complainant brings an action 
     under subparagraph (D), any person adversely affected or 
     aggrieved by a final order issued under subparagraph (A) may 
     file a petition for review of the order in the United States 
     Court of Appeals for the circuit in which the violation with 
     respect to which the order was issued, allegedly occurred or 
     the circuit in which the complainant resided on the date of 
     such violation, not later than 60 days after the date of the 
     issuance of the final order of the Secretary of Labor under 
     subparagraph (A). Review shall conform to chapter 7 of title 
     5, United States Code. The commencement of proceedings under 
     this subparagraph shall not, unless ordered by the court, 
     operate as a stay of the order. An order of the Secretary of 
     Labor with respect to which review could have been obtained 
     under this subparagraph shall not be subject to judicial 
     review in any criminal or other civil proceeding.
       (5) Failure to comply with order.--
       (A) Actions by the secretary.--If any person has failed to 
     comply with a final order issued under paragraph (4), the 
     Secretary of Labor may file a civil action in the United 
     States district court for the district in which the violation 
     was found to have occurred, or in the United States district 
     court for the District of Columbia, to enforce such order. In 
     actions brought under this paragraph, the district courts 
     shall have jurisdiction to grant all appropriate relief 
     including injunctive relief and compensatory damages.
       (B) Civil actions to compel compliance.--A person on whose 
     behalf an order was issued under paragraph (4) may commence a 
     civil action against the person to whom such order was issued 
     to require compliance with such order. The appropriate United 
     States district court shall have jurisdiction, without regard 
     to the amount in controversy or the citizenship of the 
     parties, to enforce such order.
       (C) Award of costs authorized.--The court, in issuing any 
     final order under this paragraph, may award costs of 
     litigation (including reasonable attorney and expert witness 
     fees) to any party, whenever the court determines such award 
     is appropriate.
       (D) Mandamus proceedings.--Any nondiscretionary duty 
     imposed by this section shall be enforceable in a mandamus 
     proceeding brought under section 1361 of title 28, United 
     States Code.
       (d) Unenforceability of Certain Agreements.--
       (1) No waiver of rights and remedies.--Except as provided 
     under paragraph (3), and notwithstanding any other provision 
     of law, the rights and remedies provided for in this section 
     may not be waived by any agreement, policy, form, or 
     condition of employment, including by any predispute 
     arbitration agreement.
       (2) No predispute arbitration agreements.--Except as 
     provided under paragraph (3), and notwithstanding any other 
     provision of law, no predispute arbitration agreement shall 
     be valid or enforceable to the extent

[[Page S3247]]

     that it requires arbitration of a dispute arising under this 
     section.
       (3) Exception.--Notwithstanding paragraphs (1) and (2), an 
     arbitration provision in a collective bargaining agreement 
     shall be enforceable as to disputes arising under subsection 
     (a)(4), unless the Bureau determines, by rule, that such 
     provision is inconsistent with the purposes of this title.

     SEC. 1058. EFFECTIVE DATE.

       This subtitle shall become effective on the designated 
     transfer date.

     Subtitle F--Transfer of Functions and Personnel; Transitional 
                               Provisions

     SEC. 1061. TRANSFER OF CONSUMER FINANCIAL PROTECTION 
                   FUNCTIONS.

       (a) Defined Terms.--For purposes of this subtitle--
       (1) the term ``consumer financial protection functions'' 
     means research, rulemaking, issuance of orders or guidance, 
     supervision, examination, and enforcement activities, powers, 
     and duties relating to the offering or provision of consumer 
     financial products or services; and
       (2) the terms ``transferor agency'' and ``transferor 
     agencies'' mean, respectively--
       (A) the Board of Governors (and any Federal reserve bank, 
     as the context requires), the Federal Deposit Insurance 
     Corporation, the Federal Trade Commission, the National 
     Credit Union Administration, the Office of the Comptroller of 
     the Currency, the Office of Thrift Supervision, and the 
     Department of Housing and Urban Development, and the heads of 
     those agencies; and
       (B) the agencies listed in subparagraph (A), collectively.
       (b) In General.--Except as provided in subsection (c), 
     consumer financial protection functions are transferred as 
     follows:
       (1) Board of governors.--
       (A) Transfer of functions.--All consumer financial 
     protection functions of the Board of Governors are 
     transferred to the Bureau.
       (B) Board of governors authority.--The Bureau shall have 
     all powers and duties that were vested in the Board of 
     Governors, relating to consumer financial protection 
     functions, on the day before the designated transfer date.
       (2) Comptroller of the currency.--
       (A) Transfer of functions.--All consumer financial 
     protection functions of the Comptroller of the Currency are 
     transferred to the Bureau.
       (B) Comptroller authority.--The Bureau shall have all 
     powers and duties that were vested in the Comptroller of the 
     Currency, relating to consumer financial protection 
     functions, on the day before the designated transfer date.
       (3) Director of the office of thrift supervision.--
       (A) Transfer of functions.--All consumer financial 
     protection functions of the Director of the Office of Thrift 
     Supervision are transferred to the Bureau.
       (B) Director authority.--The Bureau shall have all powers 
     and duties that were vested in the Director of the Office of 
     Thrift Supervision, relating to consumer financial protection 
     functions, on the day before the designated transfer date.
       (4) Federal deposit insurance corporation.--
       (A) Transfer of functions.--All consumer financial 
     protection functions of the Federal Deposit Insurance 
     Corporation are transferred to the Bureau.
       (B) Corporation authority.--The Bureau shall have all 
     powers and duties that were vested in the Federal Deposit 
     Insurance Corporation, relating to consumer financial 
     protection functions, on the day before the designated 
     transfer date.
       (5) Federal trade commission.--
       (A) Transfer of functions.--Except as provided in 
     subparagraph (C), all consumer financial protection functions 
     of the Federal Trade Commission are transferred to the 
     Bureau.
       (B) Commission authority.--Except as provided in 
     subparagraph (C), the Bureau shall have all powers and duties 
     that were vested in the Federal Trade Commission relating to 
     consumer financial protection functions on the day before the 
     designated transfer date.
       (C) Continuation of certain commission authorities.--
     Notwithstanding subparagraphs (A) and (B), the Federal Trade 
     Commission shall continue to have authority to enforce, and 
     issue rules with respect to--
       (i) the Credit Repair Organizations Act (15 U.S.C. 1679 et 
     seq.);
       (ii) section 5 of the Federal Trade Commission Act (15 
     U.S.C. 45); and
       (iii) the Telemarketing and Consumer Fraud and Abuse 
     Prevention Act (15 U.S.C. 6101 et seq.).
       (6) National credit union administration.--
       (A) Transfer of functions.--All consumer financial 
     protection functions of the National Credit Union 
     Administration are transferred to the Bureau.
       (B) National credit union administration authority.--The 
     Bureau shall have all powers and duties that were vested in 
     the National Credit Union Administration, relating to 
     consumer financial protection functions, on the day before 
     the designated transfer date.
       (7) Department of housing and urban development.--
       (A) Transfer of functions.--All consumer protection 
     functions of the Secretary of the Department of Housing and 
     Urban Development relating to the Real Estate Settlement 
     Procedures Act of 1974 (12 U.S.C. 2601 et seq.) and the 
     Secure and Fair Enforcement for Mortgage Licensing Act of 
     2008 (12 U.S.C. 5102 et seq.) are transferred to the Bureau.
       (B) Authority of the department of housing and urban 
     development.--The Bureau shall have all powers and duties 
     that were vested in the Secretary of the Department of 
     Housing and Urban Development relating to the Real Estate 
     Settlement Procedures Act of 1974 (12 U.S.C. 2601 et seq.), 
     and the Secure and Fair Enforcement for Mortgage Licensing 
     Act of 2008 (12 U.S.C. 5101 et seq.), on the day before the 
     designated transfer date.
       (c) Transfers of Functions Subject to Examination and 
     Enforcement Authority Remaining With Transferor Agencies.--
     The transfers of functions in subsection (b) do not affect 
     the authority of the agencies identified in subsection (b) 
     from conducting examinations or initiating and maintaining 
     enforcement proceedings, including performing appropriate 
     supervisory and support functions relating thereto, in 
     accordance with sections 1024, 1025, and 1026.
       (d) Effective Date.--Subsections (b) and (c) shall become 
     effective on the designated transfer date.

     SEC. 1062. DESIGNATED TRANSFER DATE.

       (a) In General.--Not later than 60 days after the date of 
     enactment of this Act, the Secretary shall--
       (1) in consultation with the Chairman of the Board of 
     Governors, the Chairperson of the Corporation, the Chairman 
     of the Federal Trade Commission, the Chairman of the National 
     Credit Union Administration Board, the Comptroller of the 
     Currency, the Director of the Office of Thrift Supervision, 
     the Secretary of the Department of Housing and Urban 
     Development, and the Director of the Office of Management and 
     Budget, designate a single calendar date for the transfer of 
     functions to the Bureau under section 1061; and
       (2) publish notice of that designated date in the Federal 
     Register.
       (b) Changing Designation.--The Secretary--
       (1) may, in consultation with the Chairman of the Board of 
     Governors, the Chairperson of the Federal Deposit Insurance 
     Corporation, the Chairman of the Federal Trade Commission, 
     the Chairman of the National Credit Union Administration 
     Board, the Comptroller of the Currency, the Director of the 
     Office of Thrift Supervision, the Secretary of the Department 
     of Housing and Urban Development, and the Director of the 
     Office of Management and Budget, change the date designated 
     under subsection (a); and
       (2) shall publish notice of any changed designated date in 
     the Federal Register.
       (c) Permissible Dates.--
       (1) In general.--Except as provided in paragraph (2), any 
     date designated under this section shall be not earlier than 
     180 days, nor later than 18 months, after the date of 
     enactment of this Act.
       (2) Extension of time.--The Secretary may designate a date 
     that is later than 18 months after the date of enactment of 
     this Act if the Secretary transmits to appropriate committees 
     of Congress--
       (A) a written determination that orderly implementation of 
     this title is not feasible before the date that is 18 months 
     after the date of enactment of this Act;
       (B) an explanation of why an extension is necessary for the 
     orderly implementation of this title; and
       (C) a description of the steps that will be taken to effect 
     an orderly and timely implementation of this title within the 
     extended time period.
       (3) Extension limited.--In no case may any date designated 
     under this section be later than 24 months after the date of 
     enactment of this Act.

     SEC. 1063. SAVINGS PROVISIONS.

       (a) Board of Governors.--
       (1) Existing rights, duties, and obligations not 
     affected.--Section 1061(b)(1) does not affect the validity of 
     any right, duty, or obligation of the United States, the 
     Board of Governors (or any Federal reserve bank), or any 
     other person that--
       (A) arises under any provision of law relating to any 
     consumer financial protection function of the Board of 
     Governors transferred to the Bureau by this title; and
       (B) existed on the day before the designated transfer date.
       (2) Continuation of suits.--No provision of this Act shall 
     abate any proceeding commenced by or against the Board of 
     Governors (or any Federal reserve bank) before the designated 
     transfer date with respect to any consumer financial 
     protection function of the Board of Governors (or any Federal 
     reserve bank) transferred to the Bureau by this title, except 
     that the Bureau, subject to sections 1024, 1025, and 1026, 
     shall be substituted for the Board of Governors (or Federal 
     reserve bank) as a party to any such proceeding as of the 
     designated transfer date.
       (b) Federal Deposit Insurance Corporation.--
       (1) Existing rights, duties, and obligations not 
     affected.--Section 1061(b)(4) does not affect the validity of 
     any right, duty, or obligation of the United States, the 
     Federal Deposit Insurance Corporation, the Board of Directors 
     of that Corporation, or any other person, that--
       (A) arises under any provision of law relating to any 
     consumer financial protection function of the Federal Deposit 
     Insurance Corporation transferred to the Bureau by this 
     title; and
       (B) existed on the day before the designated transfer date.

[[Page S3248]]

       (2) Continuation of suits.--No provision of this Act shall 
     abate any proceeding commenced by or against the Federal 
     Deposit Insurance Corporation (or the Board of Directors of 
     that Corporation) before the designated transfer date with 
     respect to any consumer financial protection function of the 
     Federal Deposit Insurance Corporation transferred to the 
     Bureau by this title, except that the Bureau, subject to 
     sections 1024, 1025, and 1026, shall be substituted for the 
     Federal Deposit Insurance Corporation (or Board of Directors) 
     as a party to any such proceeding as of the designated 
     transfer date.
       (c) Federal Trade Commission.--
       (1) Existing rights, duties, and obligations not 
     affected.--Section 1061(b)(5) does not affect the validity of 
     any right, duty, or obligation of the United States, the 
     Federal Trade Commission, or any other person, that--
       (A) arises under any provision of law relating to any 
     consumer financial protection function of the Federal Trade 
     Commission transferred to the Bureau by this title; and
       (B) existed on the day before the designated transfer date.
       (2) Continuation of suits.--No provision of this Act shall 
     abate any proceeding commenced by or against the Federal 
     Trade Commission before the designated transfer date with 
     respect to any consumer financial protection function of the 
     Federal Trade Commission transferred to the Bureau by this 
     title, except that the Bureau, subject to sections 1024, 
     1025, and 1026, shall be substituted for the Federal Trade 
     Commission as a party to any such proceeding as of the 
     designated transfer date.
       (d) National Credit Union Administration.--
       (1) Existing rights, duties, and obligations not 
     affected.--Section 1061(b)(6) does not affect the validity of 
     any right, duty, or obligation of the United States, the 
     National Credit Union Administration, the National Credit 
     Union Administration Board, or any other person, that--
       (A) arises under any provision of law relating to any 
     consumer financial protection function of the National Credit 
     Union Administration transferred to the Bureau by this title; 
     and
       (B) existed on the day before the designated transfer date.
       (2) Continuation of suits.--No provision of this Act shall 
     abate any proceeding commenced by or against the National 
     Credit Union Administration (or the National Credit Union 
     Administration Board) before the designated transfer date 
     with respect to any consumer financial protection function of 
     the National Credit Union Administration transferred to the 
     Bureau by this title, except that the Bureau, subject to 
     sections 1024, 1025, and 1026, shall be substituted for the 
     National Credit Union Administration (or National Credit 
     Union Administration Board) as a party to any such proceeding 
     as of the designated transfer date.
       (e) Office of the Comptroller of the Currency.--
       (1) Existing rights, duties, and obligations not 
     affected.--Section 1061(b)(2) does not affect the validity of 
     any right, duty, or obligation of the United States, the 
     Comptroller of the Currency, the Office of the Comptroller of 
     the Currency, or any other person, that--
       (A) arises under any provision of law relating to any 
     consumer financial protection function of the Comptroller of 
     the Currency transferred to the Bureau by this title; and
       (B) existed on the day before the designated transfer date.
       (2) Continuation of suits.--No provision of this Act shall 
     abate any proceeding commenced by or against the Comptroller 
     of the Currency (or the Office of the Comptroller of the 
     Currency) with respect to any consumer financial protection 
     function of the Comptroller of the Currency transferred to 
     the Bureau by this title before the designated transfer date, 
     except that the Bureau, subject to sections 1024, 1025, and 
     1026, shall be substituted for the Comptroller of the 
     Currency (or the Office of the Comptroller of the Currency) 
     as a party to any such proceeding as of the designated 
     transfer date.
       (f) Office of Thrift Supervision.--
       (1) Existing rights, duties, and obligations not 
     affected.--Section 1061(b)(3) does not affect the validity of 
     any right, duty, or obligation of the United States, the 
     Director of the Office of Thrift Supervision, the Office of 
     Thrift Supervision, or any other person, that--
       (A) arises under any provision of law relating to any 
     consumer financial protection function of the Director of the 
     Office of Thrift Supervision transferred to the Bureau by 
     this title; and
       (B) that existed on the day before the designated transfer 
     date.
       (2) Continuation of suits.--No provision of this Act shall 
     abate any proceeding commenced by or against the Director of 
     the Office of Thrift Supervision (or the Office of Thrift 
     Supervision) with respect to any consumer financial 
     protection function of the Director of the Office of Thrift 
     Supervision transferred to the Bureau by this title before 
     the designated transfer date, except that the Bureau, subject 
     to sections 1024, 1025, and 1026, shall be substituted for 
     the Director (or the Office of Thrift Supervision) as a party 
     to any such proceeding as of the designated transfer date.
       (g) Department of Housing and Urban Development.--
       (1) Existing rights, duties, and obligations not 
     affected.--Section 1061(b)(7) shall not affect the validity 
     of any right, duty, or obligation of the United States, the 
     Secretary of the Department of Housing and Urban Development 
     (or the Department of Housing and Urban Development), or any 
     other person, that--
       (A) arises under any provision of law relating to any 
     function of the Secretary of the Department of Housing and 
     Urban Development with respect to the Real Estate Settlement 
     Procedures Act of 1974 (12 U.S.C. 2601 et seq.) or the Secure 
     and Fair Enforcement for Mortgage Licensing Act of 2008 (12 
     U.S.C. 5102 et seq.) transferred to the Bureau by this title; 
     and
       (B) existed on the day before the designated transfer date.
       (2) Continuation of suits.--This title shall not abate any 
     proceeding commenced by or against the Secretary of the 
     Department of Housing and Urban Development (or the 
     Department of Housing and Urban Development) with respect to 
     any consumer financial protection function of the Secretary 
     of the Department of Housing and Urban Development 
     transferred to the Bureau by this title before the designated 
     transfer date, except that the Bureau, subject to sections 
     1024, 1025, and 1026, shall be substituted for the Secretary 
     of the Department of Housing and Urban Development (or the 
     Department of Housing and Urban Development) as a party to 
     any such proceeding as of the designated transfer date.
       (h) Continuation of Existing Orders, Rules, Determinations, 
     Agreements, and Resolutions.--All orders, resolutions, 
     determinations, agreements, and rules that have been issued, 
     made, prescribed, or allowed to become effective by any 
     transferor agency or by a court of competent jurisdiction, in 
     the performance of consumer financial protection functions 
     that are transferred by this title and that are in effect on 
     the day before the designated transfer date, shall continue 
     in effect according to the terms of those orders, 
     resolutions, determinations, agreements, and rules, and shall 
     not be enforceable by or against the Bureau.
       (i) Identification of Rules Continued.--Not later than the 
     designated transfer date, the Bureau--
       (1) shall, after consultation with the head of each 
     transferor agency, identify the rules continued under 
     subsection (h) that will be enforced by the Bureau; and
       (2) shall publish a list of such rules in the Federal 
     Register.
       (j) Status of Rules Proposed or Not Yet Effective.--
       (1) Proposed rules.--Any proposed rule of a transferor 
     agency which that agency, in performing consumer financial 
     protection functions transferred by this title, has proposed 
     before the designated transfer date, but has not been 
     published as a final rule before that date, shall be deemed 
     to be a proposed rule of the Bureau.
       (2) Rules not yet effective.--Any interim or final rule of 
     a transferor agency which that agency, in performing consumer 
     financial protection functions transferred by this title, has 
     published before the designated transfer date, but which has 
     not become effective before that date, shall become effective 
     as a rule of the Bureau according to its terms.

     SEC. 1064. TRANSFER OF CERTAIN PERSONNEL.

       (a) In General.--
       (1) Certain federal reserve system employees transferred.--
       (A) Identifying employees for transfer.--The Bureau and the 
     Board of Governors shall--
       (i) jointly determine the number of employees of the Board 
     of Governors necessary to perform or support the consumer 
     financial protection functions of the Board of Governors that 
     are transferred to the Bureau by this title; and
       (ii) consistent with the number determined under clause 
     (i), jointly identify employees of the Board of Governors for 
     transfer to the Bureau, in a manner that the Bureau and the 
     Board of Governors, in their sole discretion, determine 
     equitable.
       (B) Identified employees transferred.--All employees of the 
     Board of Governors identified under subparagraph (A)(ii) 
     shall be transferred to the Bureau for employment.
       (C) Federal reserve bank employees.--Employees of any 
     Federal reserve bank who, on the day before the designated 
     transfer date, are performing consumer financial protection 
     functions on behalf of the Board of Governors shall be 
     treated as employees of the Board of Governors for purposes 
     of subparagraphs (A) and (B).
       (2) Certain fdic employees transferred.--
       (A) Identifying employees for transfer.--The Bureau and the 
     Board of Directors of the Federal Deposit Insurance 
     Corporation shall--
       (i) jointly determine the number of employees of that 
     Corporation necessary to perform or support the consumer 
     financial protection functions of the Corporation that are 
     transferred to the Bureau by this title; and
       (ii) consistent with the number determined under clause 
     (i), jointly identify employees of the Corporation for 
     transfer to the Bureau, in a manner that the Bureau and the 
     Board of Directors of the Corporation, in their sole 
     discretion, determine equitable.
       (B) Identified employees transferred.--All employees of the 
     Corporation identified under subparagraph (A)(ii) shall be 
     transferred to the Bureau for employment.
       (3) Certain ncua employees transferred.--

[[Page S3249]]

       (A) Identifying employees for transfer.--The Bureau and the 
     National Credit Union Administration Board shall--
       (i) jointly determine the number of employees of the 
     National Credit Union Administration necessary to perform or 
     support the consumer financial protection functions of the 
     National Credit Union Administration that are transferred to 
     the Bureau by this title; and
       (ii) consistent with the number determined under clause 
     (i), jointly identify employees of the National Credit Union 
     Administration for transfer to the Bureau, in a manner that 
     the Bureau and the National Credit Union Administration 
     Board, in their sole discretion, determine equitable.
       (B) Identified employees transferred.--All employees of the 
     National Credit Union Administration identified under 
     subparagraph (A)(ii) shall be transferred to the Bureau for 
     employment.
       (4) Certain office of the comptroller of the currency 
     employees transferred.--
       (A) Identifying employees for transfer.--The Bureau and the 
     Comptroller of the Currency shall--
       (i) jointly determine the number of employees of the Office 
     of the Comptroller of the Currency necessary to perform or 
     support the consumer financial protection functions of the 
     Office of the Comptroller of the Currency that are 
     transferred to the Bureau by this title; and
       (ii) consistent with the number determined under clause 
     (i), jointly identify employees of the Office of the 
     Comptroller of the Currency for transfer to the Bureau, in a 
     manner that the Bureau and the Office of the Comptroller of 
     the Currency, in their sole discretion, determine equitable.
       (B) Identified employees transferred.--All employees of the 
     Office of the Comptroller of the Currency identified under 
     subparagraph (A)(ii) shall be transferred to the Bureau for 
     employment.
       (5) Certain office of thrift supervision employees 
     transferred.--
       (A) Identifying employees for transfer.--The Bureau and the 
     Director of the Office of Thrift Supervision shall--
       (i) jointly determine the number of employees of the Office 
     of Thrift Supervision necessary to perform or support the 
     consumer financial protection functions of the Office of 
     Thrift Supervision that are transferred to the Bureau by this 
     title; and
       (ii) consistent with the number determined under clause 
     (i), jointly identify employees of the Office of Thrift 
     Supervision for transfer to the Bureau, in a manner that the 
     Bureau and the Office of Thrift Supervision, in their sole 
     discretion, determine equitable.
       (B) Identified employees transferred.--All employees of the 
     Office of Thrift Supervision identified under subparagraph 
     (A)(ii) shall be transferred to the Bureau for employment.
       (6) Certain employees of department of housing and urban 
     development transferred.--
       (A) Identifying employees for transfer.--The Bureau and the 
     Secretary of the Department of Housing and Urban Development 
     shall--
       (i) jointly determine the number of employees of the 
     Department of Housing and Urban Development necessary to 
     perform or support the consumer protection functions of the 
     Department that are transferred to the Bureau by this title; 
     and
       (ii) consistent with the number determined under clause 
     (i), jointly identify employees of the Department of Housing 
     and Urban Development for transfer to the Bureau in a manner 
     that the Bureau and the Secretary of the Department of 
     Housing and Urban Development, in their sole discretion, deem 
     equitable.
       (B) Identified employees transferred.--All employees of the 
     Department of Housing and Urban Development identified under 
     subparagraph (A)(ii) shall be transferred to the Bureau for 
     employment.
       (7) Appointment authority for excepted service and senior 
     executive service transferred.--
       (A) In general.--In the case of an employee occupying a 
     position in the excepted service or the Senior Executive 
     Service, any appointment authority established pursuant to 
     law or regulations of the Office of Personnel Management for 
     filling such positions shall be transferred, subject to 
     subparagraph (B).
       (B) Declining transfers allowed.--An agency or entity may 
     decline to make a transfer of authority under subparagraph 
     (A) (and the employees appointed pursuant thereto) to the 
     extent that such authority relates to positions excepted from 
     the competitive service because of their confidential, 
     policy-making, policy-determining, or policy-advocating 
     character, and non-career positions in the Senior Executive 
     Service (within the meaning of section 3132(a)(7) of title 5, 
     United States Code).
       (b) Timing of Transfers and Position Assignments.--Each 
     employee to be transferred under this section shall--
       (1) be transferred not later than 90 days after the 
     designated transfer date; and
       (2) receive notice of a position assignment not later than 
     120 days after the effective date of his or her transfer.
       (c) Transfer of Function.--
       (1) In general.--Notwithstanding any other provision of 
     law, the transfer of employees shall be deemed a transfer of 
     functions for the purpose of section 3503 of title 5, United 
     States Code.
       (2) Priority of this title.--If any provisions of this 
     title conflict with any protection provided to transferred 
     employees under section 3503 of title 5, United States Code, 
     the provisions of this title shall control.
       (d) Equal Status and Tenure Positions.--
       (1) Employees transferred from fdic, ftc, hud, ncua, occ, 
     and ots.--Each employee transferred from the Federal Deposit 
     Insurance Corporation, the Federal Trade Commission, the 
     National Credit Union Administration, the Office of the 
     Comptroller of the Currency, the Office of Thrift 
     Supervision, or the Department of Housing and Urban 
     Development shall be placed in a position at the Bureau with 
     the same status and tenure as that employee held on the day 
     before the designated transfer date.
       (2) Employees transferred from the federal reserve 
     system.--
       (A) Comparability.--Each employee transferred from the 
     Board of Governors or from a Federal reserve bank shall be 
     placed in a position with the same status and tenure as that 
     of an employee transferring to the Bureau from the Office of 
     the Comptroller of the Currency who perform similar functions 
     and have similar periods of service.
       (B) Service periods credited.--For purposes of this 
     paragraph, periods of service with the Board of Governors or 
     a Federal reserve bank shall be credited as periods of 
     service with a Federal agency.
       (e) Additional Certification Requirements Limited.--
     Examiners transferred to the Bureau are not subject to any 
     additional certification requirements before being placed in 
     a comparable examiner position at the Bureau examining the 
     same types of institutions as they examined before they were 
     transferred.
       (f) Personnel Actions Limited.--
       (1) 2-Year protection.--Except as provided in paragraph 
     (2), each transferred employee holding a permanent position 
     on the day before the designated transfer date may not, 
     during the 2-year period beginning on the designated transfer 
     date, be involuntarily separated, or involuntarily reassigned 
     outside his or her locality pay area, as defined by the 
     Office of Personnel Management.
       (2) Exceptions.--Paragraph (1) does not limit the right of 
     the Bureau--
       (A) to separate an employee for cause or for unacceptable 
     performance;
       (B) to terminate an appointment to a position excepted from 
     the competitive service because of its confidential policy-
     making, policy-determining, or policy-advocating character; 
     or
       (C) to reassign a supervisory employee outside his or her 
     locality pay area, as defined by the Office of Personnel 
     Management, when the Bureau determines that the reassignment 
     is necessary for the efficient operation of the Bureau.
       (g) Pay.--
       (1) 2-Year protection.--Except as provided in paragraph 
     (2), each transferred employee shall, during the 2-year 
     period beginning on the designated transfer date, receive pay 
     at a rate equal to not less than the basic rate of pay 
     (including any geographic differential) that the employee 
     received during the pay period immediately preceding the date 
     of transfer.
       (2) Exceptions.--Paragraph (1) does not limit the right of 
     the Bureau to reduce the rate of basic pay of a transferred 
     employee--
       (A) for cause;
       (B) for unacceptable performance; or
       (C) with the consent of the employee.
       (3) Protection only while employed.--Paragraph (1) applies 
     to a transferred employee only while that employee remains 
     employed by the Bureau.
       (4) Pay increases permitted.--Paragraph (1) does not limit 
     the authority of the Bureau to increase the pay of a 
     transferred employee.
       (h) Reorganization.--
       (1) Between 1st and 3rd year.--
       (A) In general.--If the Bureau determines, during the 2-
     year period beginning 1 year after the designated transfer 
     date, that a reorganization of the staff of the Bureau is 
     required--
       (i) that reorganization shall be deemed a ``major 
     reorganization'' for purposes of affording affected employees 
     retirement under section 8336(d)(2) or 8414(b)(1)(B) of title 
     5, United States Code;
       (ii) before the reorganization occurs, all employees in the 
     same locality pay area as defined by the Office of Personnel 
     Management shall be placed in a uniform position 
     classification system; and
       (iii) any resulting reduction in force shall be governed by 
     the provisions of chapter 35 of title 5, United States Code, 
     except that the Bureau shall--

       (I) establish competitive areas (as that term is defined in 
     regulations issued by the Office of Personnel Management) to 
     include at a minimum all employees in the same locality pay 
     area as defined by the Office of Personnel Management;
       (II) establish competitive levels (as that term is defined 
     in regulations issued by the Office of Personnel Management) 
     without regard to whether the particular employees have been 
     appointed to positions in the competitive service or the 
     excepted service; and
       (III) afford employees appointed to positions in the 
     excepted service (other than to a position excepted from the 
     competitive service because of its confidential policy-
     making, policy-determining, or policy-advocating character) 
     the same assignment rights to positions within the Bureau as 
     employees appointed to positions in the competitive service.

[[Page S3250]]

       (B) Service credit for reductions in force.--For purposes 
     of this paragraph, periods of service with a Federal home 
     loan bank, a joint office of the Federal home loan banks, the 
     Board of Governors, a Federal reserve bank, the Federal 
     Deposit Insurance Corporation, or the National Credit Union 
     Administration shall be credited as periods of service with a 
     Federal agency.
       (2) After 3rd year.--
       (A) In general.--If the Bureau determines, at any time 
     after the 3-year period beginning on the designated transfer 
     date, that a reorganization of the staff of the Bureau is 
     required, any resulting reduction in force shall be governed 
     by the provisions of chapter 35 of title 5, United States 
     Code, except that the Bureau shall establish competitive 
     levels (as that term is defined in regulations issued by the 
     Office of Personnel Management) without regard to types of 
     appointment held by particular employees transferred under 
     this section.
       (B) Service credit for reductions in force.--For purposes 
     of this paragraph, periods of service with a Federal home 
     loan bank, a joint office of the Federal home loan banks, the 
     Board of Governors, a Federal reserve bank, the Federal 
     Deposit Insurance Corporation, or the National Credit Union 
     Administration shall be credited as periods of service with a 
     Federal agency.
       (i) Benefits.--
       (1) Retirement benefits for transferred employees.--
       (A) In general.--
       (i) Continuation of existing retirement plan.--Except as 
     provided in subparagraph (B), each transferred employee shall 
     remain enrolled in his or her existing retirement plan, 
     through any period of continuous employment with the Bureau.
       (ii) Employer contribution.--The Bureau shall pay any 
     employer contributions to the existing retirement plan of 
     each transferred employee, as required under that plan.
       (B) Option for employees transferred from federal reserve 
     system to be subject to federal employee retirement 
     program.--
       (i) Election.--Any transferred employee who was enrolled in 
     a Federal Reserve System retirement plan on the day before 
     his or her transfer to the Bureau may, during the 1-year 
     period beginning 6 months after the designated transfer date, 
     elect to be subject to the Federal employee retirement 
     program.
       (ii) Effective date of coverage.--For any employee making 
     an election under clause (i), coverage by the Federal 
     employee retirement program shall begin 1 year after the 
     designated transfer date.
       (C) Bureau participation in federal reserve system 
     retirement plan.--
       (i) Separate account in federal reserve system retirement 
     plan established.--Notwithstanding any other provision of 
     law, and subject to the terms and conditions of this section, 
     a separate account in the Federal Reserve System retirement 
     plan shall be established for Bureau employees who do not 
     make the election under subparagraph (B).
       (ii) Funds attributable to transferred employees remaining 
     in federal reserve system retirement plan transferred.--The 
     proportionate share of funds in the Federal Reserve System 
     retirement plan, including the proportionate share of any 
     funding surplus in that plan, attributable to a transferred 
     employee who does not make the election under subparagraph 
     (B), shall be transferred to the account established under 
     clause (i).
       (iii) Employer contributions deposited.--The Bureau shall 
     deposit into the account established under clause (i) the 
     employer contributions that the Bureau makes on behalf of 
     employees who do not make the election under subparagraph 
     (B).
       (iv) Account administration.--The Bureau shall administer 
     the account established under clause (i) as a participating 
     employer in the Federal Reserve System retirement plan.
       (D) Definitions.--For purposes of this paragraph--
       (i) the term ``existing retirement plan'' means, with 
     respect to any employee transferred under this section, the 
     particular retirement plan (including the Financial 
     Institutions Retirement Fund) and any associated thrift 
     savings plan of the agency or Federal reserve bank from which 
     the employee was transferred, in which the employee was 
     enrolled on the day before the designated transfer date; and
       (ii) the term ``Federal employee retirement program'' means 
     the retirement program for Federal employees established by 
     chapter 84 of title 5, United States Code.
       (2) Benefits other than retirement benefits for transferred 
     employees.--
       (A) During 1st year.--
       (i) Existing plans continue.--Each transferred employee 
     may, for 1 year after the designated transfer date, retain 
     membership in any other employee benefit program of the 
     agency or bank from which the employee transferred, including 
     a dental, vision, long term care, or life insurance program, 
     to which the employee belonged on the day before the 
     designated transfer date.
       (ii) Employer contribution.--The Bureau shall reimburse the 
     agency or bank from which an employee was transferred for any 
     cost incurred by that agency or bank in continuing to extend 
     coverage in the benefit program to the employee, as required 
     under that program or negotiated agreements.
       (B) Dental, vision, or life insurance after 1st year.--If, 
     after the 1-year period beginning on the designated transfer 
     date, the Bureau decides not to continue participation in any 
     dental, vision, or life insurance program of an agency or 
     bank from which an employee transferred, a transferred 
     employee who is a member of such a program may, before the 
     decision of the Bureau takes effect, elect to enroll, without 
     regard to any regularly scheduled open season, in--
       (i) the enhanced dental benefits established by chapter 89A 
     of title 5, United States Code;
       (ii) the enhanced vision benefits established by chapter 
     89B of title 5, United States Code; or
       (iii) the Federal Employees Group Life Insurance Program 
     established by chapter 87 of title 5, United States Code, 
     without regard to any requirement of insurability.
       (C) Long term care insurance after 1st year.--If, after the 
     1-year period beginning on the designated transfer date, the 
     Bureau decides not to continue participation in any long term 
     care insurance program of an agency or bank from which an 
     employee transferred, a transferred employee who is a member 
     of such a program may, before the decision of the Bureau 
     takes effect, elect to apply for coverage under the Federal 
     Long Term Care Insurance Program established by chapter 90 of 
     title 5, United States Code, under the underwriting 
     requirements applicable to a new active workforce member (as 
     defined in part 875, title 5, Code of Federal Regulations).
       (D) Employee contribution.--An individual enrolled in the 
     Federal Employees Health Benefits program shall pay any 
     employee contribution required by the plan.
       (E) Additional funding.--The Bureau shall transfer to the 
     Federal Employees Health Benefits Fund established under 
     section 8909 of title 5, United States Code, an amount 
     determined by the Director of the Office of Personnel 
     Management, after consultation with the Bureau and the Office 
     of Management and Budget, to be necessary to reimburse the 
     Fund for the cost to the Fund of providing benefits under 
     this paragraph.
       (F) Credit for time enrolled in other plans.--For employees 
     transferred under this title, enrollment in a health benefits 
     plan administered by a transferor agency or a Federal reserve 
     bank, as the case may be, immediately before enrollment in a 
     health benefits plan under chapter 89 of title 5, United 
     States Code, shall be considered as enrollment in a health 
     benefits plan under that chapter for purposes of section 
     8905(b)(1)(A) of title 5, United States Code.
       (G) Special provisions to ensure continuation of life 
     insurance benefits.--
       (i) In general.--An annuitant (as defined in section 
     8901(3) of title 5, United States Code) who is enrolled in a 
     life insurance plan administered by a transferor agency on 
     the day before the designated transfer date shall be eligible 
     for coverage by a life insurance plan under sections 8706(b), 
     8714a, 8714b, and 8714c of title 5, United States Code, or in 
     a life insurance plan established by the Bureau, without 
     regard to any regularly scheduled open season and requirement 
     of insurability.
       (ii) Employee contribution.--An individual enrolled in a 
     life insurance plan under this subparagraph shall pay any 
     employee contribution required by the plan.
       (iii) Additional funding.--The Bureau shall transfer to the 
     Employees' Life Insurance Fund established under section 8714 
     of title 5, United States Code, an amount determined by the 
     Director of the Office of Personnel Management, after 
     consultation with the Bureau and the Office of Management and 
     Budget, to be necessary to reimburse the Fund for the cost to 
     the Fund of providing benefits under this subparagraph not 
     otherwise paid for by the employee under clause (ii).
       (iv) Credit for time enrolled in other plans.--For 
     employees transferred under this title, enrollment in a life 
     insurance plan administered by a transferor agency 
     immediately before enrollment in a life insurance plan under 
     chapter 87 of title 5, United States Code, shall be 
     considered as enrollment in a life insurance plan under that 
     chapter for purposes of section 8706(b)(1)(A) of title 5, 
     United States Code.
       (3) OPM rules.--The Office of Personnel Management shall 
     issue such rules as are necessary to carry out this 
     subsection.
       (j) Implementation of Uniform Pay and Classification 
     System.--Not later than 2 years after the designated transfer 
     date, the Bureau shall implement a uniform pay and 
     classification system for all employees transferred under 
     this title.
       (k) Equitable Treatment.--In administering the provisions 
     of this section, the Bureau--
       (1) shall take no action that would unfairly disadvantage 
     transferred employees relative to each other based on their 
     prior employment by the Board of Governors, the Federal 
     Deposit Insurance Corporation, the Federal Trade Commission, 
     the National Credit Union Administration, the Office of the 
     Comptroller of the Currency, the Office of Thrift 
     Supervision, a Federal reserve bank, a Federal home loan 
     bank, or a joint office of the Federal home loan banks; and
       (2) may take such action as is appropriate in individual 
     cases so that employees transferred under this section 
     receive equitable treatment, with respect to the status, 
     tenure, pay, benefits (other than benefits under programs 
     administered by the Office of Personnel Management), and 
     accrued leave or vacation time of those employees, for prior 
     periods of service with any Federal agency,

[[Page S3251]]

     including the Board of Governors, the Corporation, the 
     Federal Trade Commission, the National Credit Union 
     Administration, the Office of the Comptroller of the 
     Currency, the Office of Thrift Supervision, a Federal reserve 
     bank, a Federal home loan bank, or a joint office of the 
     Federal home loan banks.
       (l) Implementation.--In implementing the provisions of this 
     section, the Bureau shall coordinate with the Office of 
     Personnel Management and other entities having expertise in 
     matters related to employment to ensure a fair and orderly 
     transition for affected employees.

     SEC. 1065. INCIDENTAL TRANSFERS.

       (a) Incidental Transfers Authorized.--The Director of the 
     Office of Management and Budget, in consultation with the 
     Secretary, shall make such additional incidental transfers 
     and dispositions of assets and liabilities held, used, 
     arising from, available, or to be made available, in 
     connection with the functions transferred by this title, as 
     the Director may determine necessary to accomplish the 
     purposes of this title.
       (b) Sunset.--The authority provided in this section shall 
     terminate 5 years after the date of enactment of this Act.

     SEC. 1066. INTERIM AUTHORITY OF THE SECRETARY.

       (a) In General.--The Secretary is authorized to perform the 
     functions of the Bureau under this subtitle until the 
     Director of the Bureau is confirmed by the Senate in 
     accordance with section 1011.
       (b) Interim Administrative Services by the Department of 
     the Treasury.--The Department of the Treasury may provide 
     administrative services necessary to support the Bureau 
     before the designated transfer date.

     SEC. 1067. TRANSITION OVERSIGHT.

       (a) Purpose.--The purpose of this section is to ensure that 
     the Bureau--
       (1) has an orderly and organized startup;
       (2) attracts and retains a qualified workforce; and
       (3) establishes comprehensive employee training and 
     benefits programs.
       (b) Reporting Requirement.--
       (1) In general.--The Bureau shall submit an annual report 
     to the Committee on Banking, Housing, and Urban Affairs of 
     the Senate and the Committee on Financial Services of the 
     House of Representatives that includes the plans described in 
     paragraph (2).
       (2) Plans.--The plans described in this paragraph are as 
     follows:
       (A) Training and workforce development plan.--The Bureau 
     shall submit a training and workforce development plan that 
     includes, to the extent practicable--
       (i) identification of skill and technical expertise needs 
     and actions taken to meet those requirements;
       (ii) steps taken to foster innovation and creativity;
       (iii) leadership development and succession planning; and
       (iv) effective use of technology by employees.
       (B) Workplace flexibilities plan.--The Bureau shall submit 
     a workforce flexibility plan that includes, to the extent 
     practicable--
       (i) telework;
       (ii) flexible work schedules;
       (iii) phased retirement;
       (iv) reemployed annuitants;
       (v) part-time work;
       (vi) job sharing;
       (vii) parental leave benefits and childcare assistance;
       (viii) domestic partner benefits;
       (ix) other workplace flexibilities; or
       (x) any combination of the items described in clauses (i) 
     through (ix).
       (C) Recruitment and retention plan.--The Bureau shall 
     submit a recruitment and retention plan that includes, to the 
     extent practicable, provisions relating to--
       (i) the steps necessary to target highly qualified 
     applicant pools with diverse backgrounds;
       (ii) streamlined employment application processes;
       (iii) the provision of timely notification of the status of 
     employment applications to applicants; and
       (iv) the collection of information to measure indicators of 
     hiring effectiveness.
       (c) Expiration.--The reporting requirement under subsection 
     (b) shall terminate 5 years after the date of enactment of 
     this Act.
       (d) Rule of Construction.--Nothing in this section may be 
     construed to affect--
       (1) a collective bargaining agreement, as that term is 
     defined in section 7103(a)(8) of title 5, United States Code, 
     that is in effect on the date of enactment of this Act; or
       (2) the rights of employees under chapter 71 of title 5, 
     United States Code.

                  Subtitle G--Regulatory Improvements

     SEC. 1071. GAO STUDY ON THE EFFECTIVENESS AND IMPACT OF 
                   VARIOUS APPRAISAL METHODS.

       (a) In General.--The Government Accountability Office shall 
     conduct a study on the effectiveness and impact of various 
     appraisal methods, including the cost approach, the 
     comparative sales approach, the income approach, and others 
     that may be available.
       (b) Study.--Not later than--
       (1) 1 year after the date of enactment of this Act, the 
     Government Accountability Office shall submit a study to the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate and the Committee on Financial Services of the House 
     of Representatives;
       (2) 90 days after the date of enactment of this Act, the 
     Government Accountability Office shall provide a report on 
     the status of the study and any preliminary findings to the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate and the Committee on Financial Services of the House 
     of Representatives.
       (c) Content of Study.--The study required by this section 
     shall include an examination of--
       (1) the prevalence, alone or in combination, of these 
     approaches in purchase-money and refinance mortgage 
     transactions;
       (2) the accuracy of the various approaches in assessing the 
     property as collateral;
       (3) whether and how the approaches contributed to price 
     speculation in the previous cycle;
       (4) the costs to consumers of these approaches;
       (5) the disclosure of fees to consumers in the appraisal 
     process;
       (6) to what extent such approaches may be influenced by a 
     conflict of interest between the mortgage lender and the 
     appraiser and the mechanism by which the lender selects and 
     compensates the appraiser; and
       (7) the suitability of appraisal approaches in rural versus 
     urban areas.

     SEC. 1072. PROHIBITION ON CERTAIN PREPAYMENT PENALTIES.

       (a) In General.--Chapter 2 of the Truth in Lending Act (15 
     U.S.C. 1631 et seq.) is amended by inserting after section 
     129A (15 U.S.C. 1639a) the following new section:

     ``SEC. 129B. PROHIBITION ON CERTAIN PREPAYMENT PENALTIES.

       ``(a) Prohibited on Certain Loans.--A residential mortgage 
     loan that is not a qualified mortgage may not contain terms 
     under which a consumer is required to pay a prepayment 
     penalty for paying all or part of the principal after the 
     loan is consummated.
       ``(b) Phased-Out Penalties on Qualified Mortgages.--
       ``(1) In general.--A qualified mortgage may not contain 
     terms under which a consumer is required to pay a prepayment 
     penalty for paying all or part of the principal after the 
     loan is consummated in excess of--
       ``(A) during the 1-year period beginning on the date on 
     which the loan is consummated, an amount equal to 3 percent 
     of the outstanding balance on the loan;
       ``(B) during the 1-year period beginning immediately after 
     the end of the period described in subparagraph (A), an 
     amount equal to 2 percent of the outstanding balance on the 
     loan; and
       ``(C) during the 1-year period beginning immediately after 
     the end of the 1-year period described in subparagraph (B), 
     an amount equal to 1 percent of the outstanding balance on 
     the loan.
       ``(2) Prohibition.--After the end of the 3-year period 
     beginning on the date on which the loan is consummated, no 
     prepayment penalty may be imposed on a qualified mortgage.
       ``(c) Option for No Prepayment Penalty Required.--A 
     creditor may not offer a consumer a residential mortgage loan 
     product that has a prepayment penalty for paying all or part 
     of the principal after the loan is consummated as a term of 
     the loan, without offering to the consumer a residential 
     mortgage loan product that does not have a prepayment penalty 
     as a term of the loan.
       ``(d) Prohibitions on Evasions, Structuring of 
     Transactions, and Reciprocal Arrangements.--A creditor may 
     not take any action in connection with a residential mortgage 
     loan--
       ``(1) to structure a loan transaction as an open end 
     consumer credit plan or another form of loan for the purpose 
     and with the intent of evading the provisions of this 
     section; or
       ``(2) to divide any loan transaction into separate parts 
     for the purpose and with the intent of evading provisions of 
     this section.
       ``(e) Publication of Average Prime Offer Rate and APR 
     Thresholds.--The Board--
       ``(1) shall publish, and update at least weekly, average 
     prime offer rates;
       ``(2) may publish multiple rates based on varying types of 
     mortgage transactions; and
       ``(3) shall adjust the thresholds of 1.50 percentage points 
     in subsection (g)(3)(A)(v)(I), 2.50 percentage points in 
     subsection (g)(3)(A)(v)(II), and 3.50 percentage points in 
     subsection (g)(3)(A)(v)(III), as necessary to reflect 
     significant changes in market conditions and to effectuate 
     the purposes of this section.
       ``(f) Regulations.--
       ``(1) In general.--The Bureau shall prescribe regulations 
     to carry out this section.
       ``(2) Revision of safe harbor criteria.--The Bureau may 
     prescribe regulations that revise, add to, or subtract from 
     the criteria that define a qualified mortgage, upon a finding 
     that such regulations are necessary or appropriate--
       ``(A) to ensure that responsible, affordable mortgage 
     credit remains available to consumers in a manner consistent 
     with the purposes of this section;
       ``(B) to effectuate the purposes of this section;
       ``(C) to prevent circumvention or evasion thereof; or
       ``(D) to facilitate compliance with this section.
       ``(3) Interagency harmonization.--
       ``(A) Determination of qualifying mortgage treatment.--The 
     agencies and officials described in subparagraph (B) shall, 
     in consultation with the Bureau, prescribe rules defining the 
     types of loans they insure, guarantee, or administer, as the 
     case may be,

[[Page S3252]]

     that are qualified mortgages for purposes of this section, 
     upon a finding that such rules are consistent with the 
     purposes of this section or are appropriate to prevent 
     circumvention or evasion thereof or to facilitate compliance 
     with this section.
       ``(B) Agencies and officials.--The agencies and officials 
     described in this subparagraph are--
       ``(i) the Secretary of the Department of Housing and Urban 
     Development, with regard to mortgages insured under title II 
     of the National Housing Act (12 U.S.C. 1707 et seq.);
       ``(ii) the Secretary of Veterans Affairs, with regard to a 
     loan made or guaranteed by the Secretary of Veterans Affairs;
       ``(iii) the Secretary of Agriculture, with regard to loans 
     guaranteed by the Secretary of Agriculture pursuant to 
     section 502 of the Housing Act of 1949 (42 U.S.C. 1472(h));
       ``(iv) the Federal Housing Finance Agency, with regard to 
     loans meeting the conforming loan standards of the Federal 
     National Mortgage Association or the Federal Home Loan 
     Mortgage Corporation; and
       ``(v) the Rural Housing Service, with regard to loans 
     insured by the Rural Housing Service.
       ``(4) Implementation.--Regulations required or authorized 
     to be prescribed under this subsection--
       ``(A) shall be prescribed in final form before the end of 
     the 12-month period beginning on the date of enactment of 
     this section; and
       ``(B) shall take effect not later than 18 months after the 
     date of enactment of this section.
       ``(g) Definitions.--For purposes of this section, the 
     following definitions shall apply:
       ``(1) Average prime offer rate.--The term `average prime 
     offer rate' means an annual percentage rate that is derived 
     from average interest rates, points, and other loan pricing 
     terms currently offered to consumers by a representative 
     sample of creditors for mortgage transactions that have low-
     risk pricing characteristics.
       ``(2) Prepayment penalty.--The term `prepayment penalty' 
     means any penalty for paying all or part of the principal on 
     an extension of credit before the date on which the principal 
     is due, including a computation of a refund of unearned 
     interest by a method that is less favorable to the consumer 
     than the actuarial method, as defined in section 933(d) of 
     the Housing and Community Development Act of 1992 (15 U.S.C. 
     1615(d)).
       ``(3) Qualified mortgage.--The term `qualified mortgage' 
     means--
       ``(A) any residential mortgage loan--
       ``(i) that does not have an adjustable rate;
       ``(ii) that does not allow a consumer to defer repayment of 
     principal or interest, or is not otherwise deemed a `non-
     traditional mortgage' under guidance, advisories, or 
     regulations prescribed by the Bureau;
       ``(iii) that does not provide for a repayment schedule that 
     results in negative amortization at any time;
       ``(iv) for which the terms are fully amortizing and which 
     does not result in a balloon payment, where a `balloon 
     payment' is a scheduled payment that is more than twice as 
     large as the average of earlier scheduled payments;
       ``(v) which has an annual percentage rate that does not 
     exceed the average prime offer rate for a comparable 
     transaction, as of the date on which the interest rate is 
     set--

       ``(I) by 1.5 or more percentage points, in the case of a 
     first lien residential mortgage loan having an original 
     principal obligation amount that is equal to or less than the 
     amount of the maximum limitation on the original principal 
     obligation of a mortgage in effect for a residence of the 
     applicable size, as of the date on which such interest rate 
     is set, pursuant to the sixth sentence of section 305(a)(2) 
     of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 
     1454(a)(2));
       ``(II) by 2.5 or more percentage points, in the case of a 
     first lien residential mortgage loan having an original 
     principal obligation amount that is more than the amount of 
     the maximum limitation on the original principal obligation 
     of a mortgage in effect for a residence of the applicable 
     size, as of the date on which such interest rate is set, 
     pursuant to the sixth sentence of section 305(a)(2) of the 
     Federal Home Loan Mortgage Corporation Act (12 U.S.C. 
     1454(a)(2)); or
       ``(III) by 3.5 or more percentage points, in the case of a 
     subordinate lien residential mortgage loan;

       ``(vi) for which the income and financial resources relied 
     upon to qualify the obligors on the loan are verified and 
     documented;
       ``(vii) for which the underwriting process is based on a 
     payment schedule that fully amortizes the loan over the loan 
     term and takes into account all applicable taxes, insurance, 
     and assessments;
       ``(viii) that does not cause the total monthly debts of the 
     consumer, including amounts under the loan, to exceed a 
     percentage established by regulation of the monthly gross 
     income of the consumer, or such other maximum percentage of 
     such income, as may be prescribed by regulation under 
     subsection (g), which rules shall take into consideration the 
     income of the consumer available to pay regular expenses 
     after payment of all installment and revolving debt;
       ``(ix) for which the total points and fees payable in 
     connection with the loan do not exceed 2 percent of the total 
     loan amount, where the term `points and fees' means points 
     and fees as defined by Section 103(aa)(4) of the Truth in 
     Lending Act (15 U.S.C. 1602(aa)(4)); and
       ``(x) for which the term of the loan does not exceed 30 
     years, except as such term may be extended under subsection 
     (g); and
       ``(B) any reverse mortgage that is insured by the Federal 
     Housing Administration or complies with the condition 
     established in subparagraph (A)(v).
       ``(4) Residential mortgage loan.--The term `residential 
     mortgage loan' means any consumer credit transaction that is 
     secured by a mortgage, deed of trust, or other equivalent 
     consensual security interest on a dwelling or on residential 
     real property that includes a dwelling, other than a consumer 
     credit transaction under an open end credit plan or an 
     extension of credit relating to a plan described in section 
     101(53D) of title 11, United States Code.''.
       (b) Conforming Amendments.--Section 129(c) of the Truth in 
     Lending Act (15 U.S.C. 1639(c)) is amended--
       (1) by striking paragraph (2);
       (2) by striking ``(1) In general.--''; and
       (3) by redesignating subparagraphs (A) and (B) as 
     paragraphs (1) and (2), respectively.

     SEC. 1073. ASSISTANCE FOR ECONOMICALLY VULNERABLE INDIVIDUALS 
                   AND FAMILIES.

       (a) HERA Amendments.--Section 1132 of the Housing and 
     Economic Recovery Act of 2008 (12 U.S.C. 1701x note) is 
     amended--
       (1) in subsection (a), by inserting in each of paragraphs 
     (1), (2), (3), and (4) ``or economically vulnerable 
     individuals and families'' after ``homebuyers'' each place 
     that term appears;
       (2) in subsection (b)(1), by inserting ``or economically 
     vulnerable individuals and families'' after ``homebuyers'';
       (3) in subsection (c)(1)--
       (A) in subparagraph (A), by striking ``or'' at the end;
       (B) in subparagraph (B), by striking the period at the end 
     and inserting ``; or''; and
       (C) by adding at the end the following:
       ``(C) a nonprofit corporation that--
       ``(i) is exempt from taxation under section 501(c)(3) of 
     the Internal Revenue Code of 1986; and
       ``(ii) specializes or has expertise in working with 
     economically vulnerable individuals and families, but whose 
     primary purpose is not provision of credit counseling 
     services.''; and
       (4) in subsection (d)(1), by striking ``not more than 5''.
       (b) Applicability.--Amendments made by subsection (a) shall 
     not apply to programs authorized by section 1132 of the 
     Housing and Economic Recovery Act of 2008 (12 U.S.C. 1701x 
     note) that are funded with appropriations prior to fiscal 
     year 2011.

     SEC. 1074. REMITTANCE TRANSFERS.

       (a) Treatment of Remittance Transfers.--The Electronic Fund 
     Transfer Act (15 U.S.C. 1693 et seq.) is amended--
       (1) in section 902(b) (15 U.S.C. 1693(b)), by inserting 
     ``and remittance'' after ``electronic fund'';
       (2) by redesignating sections 919, 920, 921, and 922 as 
     sections 920, 921, 922, and 923, respectively; and
       (3) by inserting after section 918 the following:

     ``SEC. 919. REMITTANCE TRANSFERS.

       ``(a) Disclosures Required for Remittance Transfers.--
       ``(1) In general.--Each remittance transfer provider shall 
     make disclosures as required under this section and in 
     accordance with rules prescribed by the Board.
       ``(2) Storefront disclosures.--
       ``(A) In general.--At every physical storefront location 
     owned or controlled by a remittance transfer provider (with 
     respect to remittance transfer activities), the remittance 
     transfer provider shall prominently post, and update daily, a 
     notice describing a model transfer for the amounts of $100 
     and $200 (in United States dollars) showing the amount of 
     currency that will be received by the designated recipient, 
     using the values of the currency into which the funds will be 
     exchanged for the 3 currencies to which that particular 
     storefront sends the greatest number of remittance transfer 
     payments, measured irrespective of the value of such 
     payments. The values shall include all fees charged by the 
     remittance transfer provider, taken out of the $100 and $200 
     amounts.
       ``(B) Electronic disclosure.--Subject to the rules 
     prescribed by the Board, a remittance transfer provider shall 
     prominently post, and update daily, a notice describing a 
     model transfer, as described in subparagraph (A), on the 
     Internet site owned or controlled by the remittance transfer 
     provider which senders use to electronically conduct 
     remittance transfer transactions.
       ``(3) Specific disclosures.--In addition to any other 
     disclosures applicable under this title, and subject to 
     paragraph (4), a remittance transfer provider shall provide, 
     in writing and in a form that the sender may keep, to each 
     sender requesting a remittance transfer, as applicable to the 
     transaction--
       ``(A) at the time at which the sender requests a remittance 
     transfer to be initiated, and prior to the sender making any 
     payment in connection with the remittance transfer, a 
     disclosure describing the amount of currency that will be 
     sent to the designated recipient, using the values of the 
     currency into which the funds will be exchanged; and
       ``(B) at the time at which the sender makes payment in 
     connection with the remittance transfer--
       ``(i) a receipt showing--

       ``(I) the information described in subparagraph (A);

[[Page S3253]]

       ``(II) the promised date of delivery to the designated 
     recipient; and
       ``(III) the name and either the telephone number or the 
     address of the designated recipient; and

       ``(ii) a statement containing--

       ``(I) information about the rights of the sender under this 
     section regarding the resolution of errors; and
       ``(II) appropriate contact information for--

       ``(aa) the remittance transfer provider; and
       ``(bb) each State or Federal agency supervising the 
     remittance transfer provider, including its State licensing 
     authority or Federal regulator, as applicable.
       ``(4) Requirements relating to disclosures.--With respect 
     to each disclosure required to be provided under paragraph 
     (3), and subject to paragraph (5), a remittance transfer 
     provider shall--
       ``(A) provide an initial notice and receipt, as required by 
     subparagraphs (A) and (B) of paragraph (3), and an error 
     resolution statement, as required by subsection (c), that 
     clearly and conspicuously describe the information required 
     to be disclosed therein; and
       ``(B) with respect to any transaction that a sender 
     conducts electronically, comply with the Electronic 
     Signatures in Global and National Commerce Act (15 U.S.C. 
     7001 et seq.).
       ``(5) Exemption authority.--The Board may, by rule, permit 
     a remittance transfer provider to satisfy the requirements 
     of--
       ``(A) paragraph (3)(A) orally, if the transaction is 
     conducted entirely by telephone;
       ``(B) paragraph (3)(B), by mailing the documents required 
     under such subparagraph to the sender, not later than 1 
     business day after the date on which the transaction is 
     conducted, if the transaction is conducted entirely by 
     telephone;
       ``(C) subparagraphs (A) and (B) of paragraph (3) together 
     in one written disclosure, but only to the extent that the 
     information provided in accordance with paragraph (3)(A) is 
     accurate at the time at which payment is made in connection 
     with the subject remittance transfer;
       ``(D) paragraph (3)(A), if a sender initiates a transaction 
     to one of those countries displayed, in the exact amount of 
     the transfers displayed pursuant to paragraph (2), if the 
     Board finds it to be appropriate; and
       ``(E) paragraph (3)(A), without compliance with section 
     101(c) of the Electronic Signatures in Global Commerce Act, 
     if a sender initiates the transaction electronically and the 
     information is displayed electronically in a manner that the 
     sender can keep.
       ``(b) Foreign Language Disclosures.--
       ``(1) In general.--The disclosures required under this 
     section shall be made in English and in each of the same 
     foreign languages principally used by the remittance transfer 
     provider, or any of its agents, to advertise, solicit, or 
     market, either orally or in writing, at that office.
       ``(2) Accounts.--In the case of a sender who holds a demand 
     deposit, savings deposit, or other asset account with the 
     remittance transfer provider (other than an occasional or 
     incidental credit balance under an open end credit plan, as 
     defined in section 103(i) of the Truth in Lending Act), the 
     disclosures required under this section shall be made in the 
     language or languages principally used by the remittance 
     transfer provider to communicate to the sender with respect 
     to the account.
       ``(c) Remittance Transfer Errors.--
       ``(1) Error resolution.--
       ``(A) In general.--If a remittance transfer provider 
     receives oral or written notice from the sender within 180 
     days of the promised date of delivery that an error occurred 
     with respect to a remittance transfer, including the amount 
     of currency designated in subsection (a)(3)(A) that was to be 
     sent to the designated recipient of the remittance transfer, 
     using the values of the currency into which the funds should 
     have been exchanged, but was not made available to the 
     designated recipient in the foreign country, the remittance 
     transfer provider shall resolve the error pursuant to this 
     subsection and investigate the reason for the error.
       ``(B) Remedies.--Not later than 90 days after the date of 
     receipt of a notice from the sender pursuant to subparagraph 
     (A), the remittance transfer provider shall, as applicable to 
     the error and as designated by the sender--
       ``(i) refund to the sender the total amount of funds 
     tendered by the sender in connection with the remittance 
     transfer which was not properly transmitted;
       ``(ii) make available to the designated recipient, without 
     additional cost to the designated recipient or to the sender, 
     the amount appropriate to resolve the error;
       ``(iii) provide such other remedy, as determined 
     appropriate by rule of the Board for the protection of 
     senders; or
       ``(iv) provide written notice to the sender that there was 
     no error with an explanation responding to the specific 
     complaint of the sender.
       ``(2) Rules.--The Board shall establish, by rule issued not 
     later than 1 calendar year after the date of enactment of the 
     Restoring American Financial Stability Act of 2010, clear and 
     appropriate standards for remittance transfer providers with 
     respect to error resolution relating to remittance transfers, 
     to protect senders from such errors. Standards prescribed 
     under this paragraph shall include appropriate standards 
     regarding record keeping, as required, including 
     documentation--
       ``(A) of the complaint of the sender;
       ``(B) that the sender provides the remittance transfer 
     provider with respect to the alleged error; and
       ``(C) of the findings of the remittance transfer provider 
     regarding the investigation of the alleged error that the 
     sender brought to their attention.
       ``(d) Applicability of This Title.--
       ``(1) In general.--A remittance transfer that is not an 
     electronic fund transfer, as defined in section 903, shall 
     not be subject to any of the provisions of sections 905 
     through 913. A remittance transfer that is an electronic fund 
     transfer, as defined in section 903, shall be subject to all 
     provisions of this title, except for section 908, that are 
     otherwise applicable to electronic fund transfers under this 
     title.
       ``(2) Rule of construction.--Nothing in this section shall 
     be construed--
       ``(A) to affect the application to any transaction, to any 
     remittance provider, or to any other person of any of the 
     provisions of subchapter II of chapter 53 of title 31, United 
     States Code, section 21 of the Federal Deposit Insurance Act 
     (12 U.S.C. 1829b), or chapter 2 of title I of Public Law 91-
     508 (12 U.S.C. 1951-1959), or any regulations promulgated 
     thereunder; or
       ``(B) to cause any fund transfer that would not otherwise 
     be treated as such under paragraph (1) to be treated as an 
     electronic fund transfer, or as otherwise subject to this 
     title, for the purposes of any of the provisions referred to 
     in subparagraph (A) or any regulations promulgated 
     thereunder.
       ``(e) Acts of Agents.--A remittance transfer provider shall 
     be liable for any violation of this section by any agent, 
     authorized delegate, or person affiliated with such provider, 
     when such agent, authorized delegate, or affiliate acts for 
     that remittance transfer provider.
       ``(f) Definitions.--As used in this section--
       ``(1) the term `designated recipient' means any person 
     located in a foreign country and identified by the sender as 
     the authorized recipient of a remittance transfer to be made 
     by a remittance transfer provider, except that a designated 
     recipient shall not be deemed to be a consumer for purposes 
     of this Act;
       ``(2) the term `remittance transfer' means the electronic 
     (as defined in section 106(2) of the Electronic Signatures in 
     Global and National Commerce Act (15 U.S.C. 7006(2))) 
     transfer of funds requested by a sender located in any State 
     to a designated recipient that is initiated by a remittance 
     transfer provider, whether or not the sender holds an account 
     with the remittance transfer provider or whether or not the 
     remittance transfer is also an electronic fund transfer, as 
     defined in section 903;
       ``(3) the term `remittance transfer provider' means any 
     person or financial institution that provides remittance 
     transfers for a consumer in the normal course of its 
     business, whether or not the consumer holds an account with 
     such person or financial institution; and
       ``(4) the term `sender' means a consumer who requests a 
     remittance provider to send a remittance transfer for the 
     consumer to a designated recipient.''.
       (b) Automated Clearinghouse System.--
       (1) Expansion of system.--The Board of Governors shall work 
     with the Federal reserve banks to expand the use of the 
     automated clearinghouse system for remittance transfers to 
     foreign countries, with a focus on countries that receive 
     significant remittance transfers from the United States, 
     based on--
       (A) the number, volume, and size of such transfers;
       (B) the significance of the volume of such transfers 
     relative to the external financial flows of the receiving 
     country, including--
       (i) the total amount transferred; and
       (ii) the total volume of payments made by United States 
     Government agencies to beneficiaries and retirees living 
     abroad;
       (C) the feasibility of such an expansion; and
       (D) the ability of the Federal Reserve System to establish 
     payment gateways in different geographic regions and currency 
     zones to receive remittance transfers and route them through 
     the payments systems in the destination countries.
       (2) Report to congress.--Not later than one calendar year 
     after the date of enactment of this Act, and on April 30 
     biennially thereafter during the 10-year period beginning on 
     that date of enactment, the Board of Governors 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 on the status of the 
     automated clearinghouse system and its progress in complying 
     with the requirements of this subsection. The report shall 
     include an analysis of adoption rates of International ACH 
     Transactions rules and formats, the efficacy of increasing 
     adoption rates, and potential recommendations to increase 
     adoption.
       (c) Expansion of Financial Institution Provision of 
     Remittance Transfers.--
       (1) Provision of guidelines to institutions.--Each of the 
     Federal banking agencies and the National Credit Union 
     Administration shall provide guidelines to financial 
     institutions under the jurisdiction of the agency regarding 
     the offering of low-cost remittance transfers and no-cost or 
     low-cost basic consumer accounts, as well as agency services 
     to remittance transfer providers.
       (2) Assistance to financial literacy commission.--As part 
     of its duties as members of the Financial Literacy and 
     Education Commission, the Bureau, the Federal banking

[[Page S3254]]

     agencies, and the National Credit Union Administration shall 
     assist the Financial Literacy and Education Commission in 
     executing the Strategy for Assuring Financial Empowerment (or 
     the ``SAFE Strategy''), as it relates to remittances.
       (d) Federal Credit Union Act Conforming Amendment.--
     Paragraph (12) of section 107 of the Federal Credit Union Act 
     (12 U.S.C. 1757) is amended to read as follows:
       ``(12) in accordance with regulations prescribed by the 
     Board--
       ``(A) to sell, to persons in the field of membership, 
     negotiable checks (including travelers checks), money orders, 
     and other similar money transfer instruments (including 
     international and domestic electronic fund transfers);
       ``(B) to provide remittance transfers, as defined in 
     section 919 of the Electronic Fund Transfer Act, to persons 
     in the field of membership; and
       ``(C) to cash checks and money orders for persons in the 
     field of membership for a fee;''.

                   Subtitle H--Conforming Amendments

     SEC. 1081. AMENDMENTS TO THE INSPECTOR GENERAL ACT.

       Effective on the date of enactment of this Act, the 
     Inspector General Act of 1978 (5 U.S.C. App. 3) is amended--
       (1) in section 8G(a)(2), by inserting ``and the Bureau of 
     Consumer Financial Protection'' after ``Board of Governors of 
     the Federal Reserve System'';
       (2) in section 8G(c), by adding at the end the following: 
     ``For purposes of implementing this section, the Chairman of 
     the Board of Governors of the Federal Reserve System shall 
     appoint the Inspector General of the Board of Governors of 
     the Federal Reserve System and the Bureau of Consumer 
     Financial Protection. The Inspector General of the Board of 
     Governors of the Federal Reserve System and the Bureau of 
     Consumer Financial Protection shall have all of the 
     authorities and responsibilities provided by this Act with 
     respect to the Bureau of Consumer Financial Protection, as if 
     the Bureau were part of the Board of Governors of the Federal 
     Reserve System.''; and
       (3) in section 8G(g)(3), by inserting ``and the Bureau of 
     Consumer Financial Protection'' after ``Board of Governors of 
     the Federal Reserve System'' the first place that term 
     appears.

     SEC. 1082. AMENDMENTS TO THE PRIVACY ACT OF 1974.

       Effective on the date of enactment of this Act, section 
     552a of title 5, United States Code, is amended by adding at 
     the end the following:
       ``(w) Applicability to Bureau of Consumer Financial 
     Protection.--Except as provided in the Consumer Financial 
     Protection Act of 2010, this section shall apply with respect 
     to the Bureau of Consumer Financial Protection.''.

     SEC. 1083. AMENDMENTS TO THE ALTERNATIVE MORTGAGE TRANSACTION 
                   PARITY ACT OF 1982.

       (a) In General.--The Alternative Mortgage Transaction 
     Parity Act of 1982 (12 U.S.C. 3801 et seq.) is amended--
       (1) in section 803 (12 U.S.C. 3802(1)), by striking 
     ``1974'' and all that follows through ``described and 
     defined'' and inserting the following: ``1974), in which the 
     interest rate or finance charge may be adjusted or 
     renegotiated, described and defined''; and
       (2) in section 804 (12 U.S.C. 3803)--
       (A) in subsection (a)--
       (i) in each of paragraphs (1), (2), and (3), by inserting 
     after ``transactions made'' each place that term appears ``on 
     or before the designated transfer date, as determined under 
     section 1062 of the Consumer Financial Protection Act of 
     2010,'';
       (ii) in paragraph (2), by striking ``and'' at the end;
       (iii) in paragraph (3), by striking the period at the end 
     and inserting ``; and''; and
       (iv) by adding at the end the following new paragraph:
       ``(4) with respect to transactions made after the 
     designated transfer date, only in accordance with regulations 
     governing alternative mortgage transactions, as issued by the 
     Bureau of Consumer Financial Protection for federally 
     chartered housing creditors, in accordance with the 
     rulemaking authority granted to the Bureau of Consumer 
     Financial Protection with regard to federally chartered 
     housing creditors under provisions of law other than this 
     section.'';
       (B) by striking subsection (c) and inserting the following:
       ``(c) Preemption of State Law.--An alternative mortgage 
     transaction may be made by a housing creditor in accordance 
     with this section, notwithstanding any State constitution, 
     law, or regulation that prohibits an alternative mortgage 
     transaction. For purposes of this subsection, a State 
     constitution, law, or regulation that prohibits an 
     alternative mortgage transaction does not include any State 
     constitution, law, or regulation that regulates mortgage 
     transactions generally, including any restriction on 
     prepayment penalties or late charges.''; and
       (C) by adding at the end the following:
       ``(d) Bureau Actions.--The Bureau of Consumer Financial 
     Protection shall--
       ``(1) review the regulations identified by the Comptroller 
     of the Currency and the National Credit Union Administration, 
     (as those rules exist on the designated transfer date), as 
     applicable under paragraphs (1) through (3) of subsection 
     (a);
       ``(2) determine whether such regulations are fair and not 
     deceptive and otherwise meet the objectives of the Consumer 
     Financial Protection Act of 2010; and
       ``(3) promulgate regulations under subsection (a)(4) after 
     the designated transfer date.
       ``(e) Designated Transfer Date.--As used in this section, 
     the term `designated transfer date' means the date determined 
     under section 1062 of the Consumer Financial Protection Act 
     of 2010.''.
       (b) Effective Date.--This section and the amendments made 
     by this section shall become effective on the designated 
     transfer date.
       (c) Rule of Construction.--The amendments made by 
     subsection (a) shall not affect any transaction covered by 
     the Alternative Mortgage Transaction Parity Act of l982 (12 
     U.S.C. 3801 et seq.) and entered into on or before the 
     designated transfer date.

     SEC. 1084. AMENDMENTS TO THE ELECTRONIC FUND TRANSFER ACT.

       The Electronic Fund Transfer Act (15 U.S.C. 1693 et seq.) 
     is amended--
       (1) by striking ``Board'' each place that term appears and 
     inserting ``Bureau'', except in section 918 (as so designated 
     by the Credit Card Act of 2009) (15 U.S.C. 1693o);
       (2) in section 903 (15 U.S.C. 1693a), by striking paragraph 
     (3) and inserting the following:
       ``(3) the term `Bureau' means the Bureau of Consumer 
     Financial Protection;'';
       (3) in section 916(d) (as so designated by section 401 of 
     the Credit CARD Act of 2009) (15 U.S.C. 1693m)--
       (A) by striking ``Federal Reserve System'' and inserting 
     ``Bureau of Consumer Financial Protection''; and
       (B) by striking ``Federal Reserve System'' and inserting 
     ``Bureau of Consumer Financial Protection''; and
       (4) in section 918 (as so designated by the Credit CARD Act 
     of 2009) (15 U.S.C. 1693o)--
       (A) in subsection (a)--
       (i) by striking ``Compliance'' and inserting ``Except as 
     otherwise provided by subtitle B of the Consumer Financial 
     Protection Act of 2010, compliance''; and
       (ii) by striking paragraph (2) and inserting the following:
       ``(2) subtitle E of the Consumer Financial Protection Act 
     of 2010, by the Bureau;''; and
       (B) by striking subsection (c) and inserting the following:
       ``(c) Overall Enforcement Authority of the Federal Trade 
     Commission.--Except to the extent that enforcement of the 
     requirements imposed under this title is specifically 
     committed to some other Government agency under subsection 
     (a), and subject to subtitle B of the Consumer Financial 
     Protection Act of 2010, the Federal Trade Commission shall 
     enforce such requirements. For the purpose of the exercise by 
     the Federal Trade Commission of its functions and powers 
     under the Federal Trade Commission Act, a violation of any 
     requirement imposed under this title shall be deemed a 
     violation of a requirement imposed under that Act. All of the 
     functions and powers of the Federal Trade Commission under 
     the Federal Trade Commission Act are available to the Federal 
     Trade Commission to enforce compliance by any person subject 
     to the jurisdiction of the Federal Trade Commission with the 
     requirements imposed under this title, irrespective of 
     whether that person is engaged in commerce or meets any other 
     jurisdictional tests under the Federal Trade Commission 
     Act.''.

     SEC. 1085. AMENDMENTS TO THE EQUAL CREDIT OPPORTUNITY ACT.

       The Equal Credit Opportunity Act (15 U.S.C. 1691 et seq.) 
     is amended--
       (1) by striking ``Board'' each place that term appears and 
     inserting ``Bureau'';
       (2) in section 702 (15 U.S.C. 1691a), by striking 
     subsection (c) and inserting the following:
       ``(c) The term `Bureau' means the Bureau of Consumer 
     Financial Protection.'';
       (3) in section 703 (15 U.S.C. 1691b)--
       (A) by striking the section heading and inserting the 
     following:

     ``SEC. 703. PROMULGATION OF REGULATIONS BY THE BUREAU.'';

       (B) by striking ``(a) Regulations.--'';
       (C) by striking subsection (b);
       (D) by redesignating paragraphs (1) through (5) as 
     subsections (a) through (e), respectively; and
       (E) in subsection (c), as so redesignated, by striking 
     ``paragraph (2)'' and inserting ``subsection (b)'';
       (4) in section 704 (15 U.S.C. 1691c)--
       (A) in subsection (a)--
       (i) by striking ``Compliance'' and inserting ``Except as 
     otherwise provided by subtitle B of the Consumer Protection 
     Financial Protection Act of 2010''; and
       (ii) by striking paragraph (2) and inserting the following:
       ``(2) Subtitle E of the Consumer Financial Protection Act 
     of 2010, by the Bureau.'';
       (B) by striking subsection (c) and inserting the following:
       ``(c) Overall Enforcement Authority of Federal Trade 
     Commission.--Except to the extent that enforcement of the 
     requirements imposed under this title is specifically 
     committed to some other Government agency under subsection 
     (a), and subject to subtitle B of the Consumer Financial 
     Protection Act of 2010, the Federal Trade Commission shall 
     enforce such requirements. For the purpose of the exercise by 
     the Federal Trade Commission of its functions and powers 
     under the Federal Trade Commission Act (15 U.S.C. 41 et 
     seq.), a violation of any requirement imposed under this 
     subchapter shall be deemed a violation of a requirement 
     imposed under that Act. All of the functions and powers of 
     the Federal Trade Commission under

[[Page S3255]]

     the Federal Trade Commission Act are available to the Federal 
     Trade Commission to enforce compliance by any person with the 
     requirements imposed under this title, irrespective of 
     whether that person is engaged in commerce or meets any other 
     jurisdictional tests under the Federal Trade Commission Act, 
     including the power to enforce any rule prescribed by the 
     Bureau under this title in the same manner as if the 
     violation had been a violation of a Federal Trade Commission 
     trade regulation rule.''; and
       (C) in subsection (d), by striking ``Board'' and inserting 
     ``Bureau''; and
       (5) in section 706(e) (15 U.S.C. 1691e(e))--
       (A) in the subsection heading--
       (i) by striking ``Board'' each place that term appears and 
     inserting ``Bureau''; and
       (ii) by striking ``Federal Reserve System'' and inserting 
     ``Bureau of Consumer Financial Protection''; and
       (B) by striking ``Federal Reserve System'' and inserting 
     ``Bureau of Consumer Financial Protection''.

     SEC. 1086. AMENDMENTS TO THE EXPEDITED FUNDS AVAILABILITY 
                   ACT.

       (a) Amendment to Section 603.--Section 603(d)(1) of the 
     Expedited Funds Availability Act (12 U.S.C. 4002) is amended 
     by inserting after ``Board'' the following ``, jointly with 
     the Director of the Bureau of Consumer Financial 
     Protection,''.
       (b) Amendments to Section 604.--Section 604 of the 
     Expedited Funds Availability Act (12 U.S.C. 4003) is 
     amended--
       (1) by inserting after ``Board'' each place that term 
     appears, other than in subsection (f), the following: ``, 
     jointly with the Director of the Bureau of Consumer Financial 
     Protection,''; and
       (2) in subsection (f), by striking ``Board.'' each place 
     that term appears and inserting the following: ``Board, 
     jointly with the Director of the Bureau of Consumer Financial 
     Protection.''.
       (c) Amendments to Section 605.--Section 605 of the 
     Expedited Funds Availability Act (12 U.S.C. 4004) is 
     amended--
       (1) by inserting after ``Board'' each place that term 
     appears, other than in the heading for section 605(f)(1), the 
     following: ``, jointly with the Director of the Bureau of 
     Consumer Financial Protection,''; and
       (2) in subsection (f)(1), in the paragraph heading, by 
     inserting ``and bureau'' after ``board''.
       (d) Amendments to Section 609.--Section 609 of the 
     Expedited Funds Availability Act (12 U.S.C. 4008) is amended:
       (1) in subsection (a), by inserting after ``Board'' the 
     following ``, jointly with the Director of the Bureau of 
     Consumer Financial Protection,''; and
       (2) by striking subsection (e) and inserting the following:
       ``(e) Consultations.--In prescribing regulations under 
     subsections (a) and (b), the Board and the Director of the 
     Bureau of Consumer Financial Protection, in the case of 
     subsection (a), and the Board, in the case of subsection (b), 
     shall consult with the Comptroller of the Currency, the Board 
     of Directors of the Federal Deposit Insurance Corporation, 
     and the National Credit Union Administration Board.''.
       (e) Expedited Funds Availability Improvements.--Section 603 
     of the Expedited Funds Availability Act (12 U.S.C. 4002) is 
     amended--
       (1) in subsection (a)(2)(D), by striking ``$100'' and 
     inserting ``$200''; and
       (2) in subsection (b)(3)(C), in the subparagraph heading, 
     by striking ``$100'' and inserting ``$200''; and
       (3) in subsection (c)(1)(B)(iii), in the clause heading, by 
     striking ``$100'' and inserting ``$200''.
       (f) Regular Adjustments for Inflation.--Section 607 of the 
     Expedited Funds Availability Act (12 U.S.C. 4006) is amended 
     by adding at the end the following:
       ``(f) Adjustments to Dollar Amounts for Inflation.--The 
     dollar amounts under this title shall be adjusted every 5 
     years after December 31, 2011, by the annual percentage 
     increase in the Consumer Price Index for Urban Wage Earners 
     and Clerical Workers, as published by the Bureau of Labor 
     Statistics, rounded to the nearest multiple of $25.''.

     SEC. 1087. AMENDMENTS TO THE FAIR CREDIT BILLING ACT.

       The Fair Credit Billing Act (15 U.S.C. 1666-1666j) is 
     amended by striking ``Board'' each place that term appears 
     and inserting ``Bureau''.

     SEC. 1088. AMENDMENTS TO THE FAIR CREDIT REPORTING ACT AND 
                   THE FAIR AND ACCURATE CREDIT TRANSACTIONS ACT.

       (a) Fair Credit Reporting Act.--The Fair Credit Reporting 
     Act (15 U.S.C. 1681 et seq.) is amended--
       (1) in section 603 (15 U.S.C. 1681a)--
       (A) by redesignating subsections (w) and (x) as subsections 
     (x) and (y), respectively; and
       (B) by inserting after subsection (v) the following:
       ``(w) The term `Bureau' means the Bureau of Consumer 
     Financial Protection.''; and
       (2) except as otherwise specifically provided in this 
     subsection--
       (A) by striking ``Federal Trade Commission'' each place 
     that term appears and inserting ``Bureau'';
       (B) by striking ``FTC'' each place that term appears and 
     inserting ``Bureau'';
       (C) by striking ``the Commission'' each place that term 
     appears and inserting ``the Bureau''; and
       (D) by striking ``The Federal banking agencies, the 
     National Credit Union Administration, and the Commission 
     shall jointly'' each place that term appears and inserting 
     ``The Bureau shall'';
       (3) in section 603(k)(2) (15 U.S.C. 1681a(k)(2)), by 
     striking ``Board of Governors of the Federal Reserve System'' 
     and inserting ``Bureau'';
       (4) in section 604(g) (15 U.S.C. 1681b(g))--
       (A) in paragraph (3), by striking subparagraph (C) and 
     inserting the following:
       ``(C) as otherwise determined to be necessary and 
     appropriate, by regulation or order, by the Bureau 
     (consistent with the enforcement authorities prescribed under 
     section 621(b)), or the applicable State insurance authority 
     (with respect to any person engaged in providing insurance or 
     annuities).'';
       (B) by striking paragraph (5) and inserting the following:
       ``(5) Regulations and effective date for paragraph (2).--
       ``(A) Regulations required.--The Bureau may, after notice 
     and opportunity for comment, prescribe regulations that 
     permit transactions under paragraph (2) that are determined 
     to be necessary and appropriate to protect legitimate 
     operational, transactional, risk, consumer, and other needs 
     (and which shall include permitting actions necessary for 
     administrative verification purposes), consistent with the 
     intent of paragraph (2) to restrict the use of medical 
     information for inappropriate purposes.''; and
       (C) by striking paragraph (6);
       (5) in section 611(e)(2) (15 U.S.C. 1681i(e)), by striking 
     paragraph (2) and inserting the following:
       ``(2) Exclusion.--Complaints received or obtained by the 
     Bureau pursuant to its investigative authority under the 
     Consumer Financial Protection Act of 2010 shall not be 
     subject to paragraph (1).'';
       (6) in section 615(h)(6) (15 U.S.C. 1681m(h)(6)), by 
     striking subparagraph (A) and inserting the following:
       ``(A) Rules required.--The Bureau shall prescribe rules to 
     carry out this subsection.'';
       (7) in section 621 (15 U.S.C. 1681s)--
       (A) by striking subsection (a) and inserting the following:
       ``(a) Enforcement by Federal Trade Commission.--
       ``(1) In general.--Except as otherwise provided by subtitle 
     B of the Consumer Financial Protection Act of 2010, 
     compliance with the requirements imposed under this title 
     shall be enforced under the Federal Trade Commission Act (15 
     U.S.C. 41 et seq.) by the Federal Trade Commission, with 
     respect to consumer reporting agencies and all other persons 
     subject thereto, except to the extent that enforcement of the 
     requirements imposed under this title is specifically 
     committed to some other Government agency under subsection 
     (b). For the purpose of the exercise by the Federal Trade 
     Commission of its functions and powers under the Federal 
     Trade Commission Act, a violation of any requirement or 
     prohibition imposed under this title shall constitute an 
     unfair or deceptive act or practice in commerce, in violation 
     of section 5(a) of the Federal Trade Commission Act (15 
     U.S.C. 45(a)), and shall be subject to enforcement by the 
     Federal Trade Commission under section 5(b) of that Act with 
     respect to any consumer reporting agency or person that is 
     subject to enforcement by the Federal Trade Commission 
     pursuant to this subsection, irrespective of whether that 
     person is engaged in commerce or meets any other 
     jurisdictional tests under the Federal Trade Commission Act. 
     The Federal Trade Commission shall have such procedural, 
     investigative, and enforcement powers (except as otherwise 
     provided by subtitle B of the Consumer Financial Protection 
     Act of 2010), including the power to issue procedural rules 
     in enforcing compliance with the requirements imposed under 
     this title and to require the filing of reports, the 
     production of documents, and the appearance of witnesses, as 
     though the applicable terms and conditions of the Federal 
     Trade Commission Act were part of this title. Any person 
     violating any of the provisions of this title shall be 
     subject to the penalties and entitled to the privileges and 
     immunities provided in the Federal Trade Commission Act as 
     though the applicable terms and provisions of such Act are 
     part of this title.
       ``(2) Penalties.--
       ``(A) Knowing violations.--Except as otherwise provided by 
     subtitle B of the Consumer Financial Protection Act of 2010, 
     in the event of a knowing violation, which constitutes a 
     pattern or practice of violations of this title, the Federal 
     Trade Commission may commence a civil action to recover a 
     civil penalty in a district court of the United States 
     against any person that violates this title. In such action, 
     such person shall be liable for a civil penalty of not more 
     than $2,500 per violation.
       ``(B) Determining penalty amount.--In determining the 
     amount of a civil penalty under subparagraph (A), the court 
     shall take into account the degree of culpability, any 
     history of such prior conduct, ability to pay, effect on 
     ability to continue to do business, and such other matters as 
     justice may require.
       ``(C) Limitation.--Notwithstanding paragraph (2), a court 
     may not impose any civil penalty on a person for a violation 
     of section 623(a)(1), unless the person has been enjoined 
     from committing the violation, or ordered not to commit the 
     violation, in an action or proceeding brought by or on behalf 
     of the Federal Trade Commission, and has violated the 
     injunction or order, and the court may

[[Page S3256]]

     not impose any civil penalty for any violation occurring 
     before the date of the violation of the injunction or 
     order.'';
       (8) by striking subsection (b) and inserting the following:
       ``(b) Enforcement by Other Agencies.--
       ``(1) In general.--Except as otherwise provided by subtitle 
     B of the Consumer Financial Protection Act of 2010, 
     compliance with the requirements imposed under this title 
     with respect to consumer reporting agencies, persons who use 
     consumer reports from such agencies, persons who furnish 
     information to such agencies, and users of information that 
     are subject to section 615(d) shall be enforced under--
       ``(A) section 8 of the Federal Deposit Insurance Act (12 
     U.S.C. 1818), in the case of--
       ``(i) any national bank, and any Federal branch or Federal 
     agency of a foreign bank, by the Office of the Comptroller of 
     the Currency;
       ``(ii) any member bank of the Federal Reserve System (other 
     than a national bank), a branch or agency of a foreign bank 
     (other than a Federal branch, Federal agency, or insured 
     State branch of a foreign bank), a commercial lending company 
     owned or controlled by a foreign bank, and any organization 
     operating under section 25 or 25A of the Federal Reserve Act, 
     by the Board of Governors of the Federal Reserve System; and
       ``(iii) any bank insured by the Federal Deposit Insurance 
     Corporation (other than a member of the Federal Reserve 
     System) and any insured State branch of a foreign bank, by 
     the Board of Directors of the Federal Deposit Insurance 
     Corporation;
       ``(B) subtitle E of the Consumer Financial Protection Act 
     of 2010, by the Bureau;
       ``(C) the Federal Credit Union Act (12 U.S.C. 1751 et 
     seq.), by the Administrator of the National Credit Union 
     Administration with respect to any Federal credit union;
       ``(D) subtitle IV of title 49, United States Code, by the 
     Secretary of Transportation, with respect to all carriers 
     subject to the jurisdiction of the Surface Transportation 
     Board;
       ``(E) the Federal Aviation Act of 1958 (49 U.S.C. App. 1301 
     et seq.), by the Secretary of Transportation, with respect to 
     any air carrier or foreign air carrier subject to that Act;
       ``(F) the Packers and Stockyards Act, 1921 (7 U.S.C. 181 et 
     seq.) (except as provided in section 406 of that Act), by the 
     Secretary of Agriculture, with respect to any activities 
     subject to that Act;
       ``(G) the Commodity Exchange Act, with respect to a person 
     subject to the jurisdiction of the Commodity Futures Trading 
     Commission; and
       ``(H) the Federal securities laws, and any other laws that 
     are subject to the jurisdiction of the Securities and 
     Exchange Commission, with respect to a person that is subject 
     to the jurisdiction of the Securities and Exchange 
     Commission.
       ``(2) Incorporated definitions.--The terms used in 
     paragraph (1) that are not defined in this title or otherwise 
     defined in section 3(s) of the Federal Deposit Insurance Act 
     (12 U.S.C. 1813(s)) have the same meanings as in section 1(b) 
     of the International Banking Act of 1978 (12 U.S.C. 3101).'';
       (9) by striking subsection (e) and inserting the following:
       ``(e) Regulatory Authority.--The Bureau shall prescribe 
     such regulations as are necessary to carry out the purposes 
     of this Act. The regulations prescribed by the Bureau under 
     this subsection shall apply to any person that is subject to 
     this Act, notwithstanding the enforcement authorities granted 
     to other agencies under this section.''; and
       (10) in section 623 (15 U.S.C. 1681s-2)--
       (A) in subsection (a)(7), by striking subparagraph (D) and 
     inserting the following:
       ``(D) Model disclosure.--
       ``(i) Duty of bureau.--The Bureau shall prescribe a brief 
     model disclosure that a financial institution may use to 
     comply with subparagraph (A), which shall not exceed 30 
     words.
       ``(ii) Use of model not required.--No provision of this 
     paragraph may be construed to require a financial institution 
     to use any such model form prescribed by the Bureau.
       ``(iii) Compliance using model.--A financial institution 
     shall be deemed to be in compliance with subparagraph (A) if 
     the financial institution uses any model form prescribed by 
     the Bureau under this subparagraph, or the financial 
     institution uses any such model form and rearranges its 
     format.''; and
       (B) by striking subsection (e) and inserting the following:
       ``(e) Accuracy Guidelines and Regulations Required.--
       ``(1) Guidelines.--The Bureau shall, with respect to 
     persons or entities that are subject to the enforcement 
     authority of the Bureau under section 621--
       ``(A) establish and maintain guidelines for use by each 
     person that furnishes information to a consumer reporting 
     agency regarding the accuracy and integrity of the 
     information relating to consumers that such entities furnish 
     to consumer reporting agencies, and update such guidelines as 
     often as necessary; and
       ``(B) prescribe regulations requiring each person that 
     furnishes information to a consumer reporting agency to 
     establish reasonable policies and procedures for implementing 
     the guidelines established pursuant to subparagraph (A).
       ``(2) Criteria.--In developing the guidelines required by 
     paragraph (1)(A), the Bureau shall--
       ``(A) identify patterns, practices, and specific forms of 
     activity that can compromise the accuracy and integrity of 
     information furnished to consumer reporting agencies;
       ``(B) review the methods (including technological means) 
     used to furnish information relating to consumers to consumer 
     reporting agencies;
       ``(C) determine whether persons that furnish information to 
     consumer reporting agencies maintain and enforce policies to 
     ensure the accuracy and integrity of information furnished to 
     consumer reporting agencies; and
       ``(D) examine the policies and processes that persons that 
     furnish information to consumer reporting agencies employ to 
     conduct reinvestigations and correct inaccurate information 
     relating to consumers that has been furnished to consumer 
     reporting agencies.''.
       (b) Fair and Accurate Credit Transactions Act of 2003.--
     Section 214(b)(1) of the Fair and Accurate Credit 
     Transactions Act of 2003 (15 U.S.C. 1681s-3 note) is amended 
     by striking paragraph (1) and inserting the following:
       ``(1) In general.--Regulations to carry out section 624 of 
     the Fair Credit Reporting Act (15 U.S.C. 1681s-3), shall be 
     prescribed, as described in paragraph (2), by--
       ``(A) the Commodity Futures Trading Commission, with 
     respect to entities subject to its enforcement authorities;
       ``(B) the Securities and Exchange Commission, with respect 
     to entities subject to its enforcement authorities; and
       ``(C) the Bureau, with respect to other entities subject to 
     this Act.''.

     SEC. 1089. AMENDMENTS TO THE FAIR DEBT COLLECTION PRACTICES 
                   ACT.

       The Fair Debt Collection Practices Act (15 U.S.C. 1692 et 
     seq.) is amended--
       (1) by striking ``Commission'' each place that term appears 
     and inserting ``Bureau'';
       (2) in section 803 (15 U.S.C. 1692a)--
       (A) by striking paragraph (1) and inserting the following:
       ``(1) The term `Bureau' means the Bureau of Consumer 
     Financial Protection.'';
       (3) in section 814 (15 U.S.C. 1692l)--
       (A) by striking subsection (a) and inserting the following:
       ``(a) Federal Trade Commission.--Except as otherwise 
     provided by subtitle B of the Consumer Financial Protection 
     Act of 2010, compliance with this title shall be enforced by 
     the Federal Trade Commission, except to the extent that 
     enforcement of the requirements imposed under this title is 
     specifically committed to another Government agency under 
     subsection (b). For purpose of the exercise by the Federal 
     Trade Commission of its functions and powers under the 
     Federal Trade Commission Act (15 U.S.C. 41 et seq.), a 
     violation of this title shall be deemed an unfair or 
     deceptive act or practice in violation of that Act. All of 
     the functions and powers of the Federal Trade Commission 
     under the Federal Trade Commission Act are available to the 
     Federal Trade Commission to enforce compliance by any person 
     with this title, irrespective of whether that person is 
     engaged in commerce or meets any other jurisdictional tests 
     under the Federal Trade Commission Act, including the power 
     to enforce the provisions of this title, in the same manner 
     as if the violation had been a violation of a Federal Trade 
     Commission trade regulation rule.''; and
       (B) in subsection (b)--
       (i) by striking ``Compliance'' and inserting ``Except as 
     otherwise provided by subtitle B of the Consumer Financial 
     Protection Act of 2010, compliance''; and
       (ii) by striking paragraph (2) and inserting the following:
       ``(2) subtitle E of the Consumer Financial Protection Act 
     of 2010, by the Bureau;''; and
       (4) in subsection (d), by striking ``Neither the 
     Commission'' and all that follows through the end of the 
     subsection and inserting the following: ``The Bureau may 
     prescribe rules with respect to the collection of debts by 
     debt collectors, as defined in this Act.''.

     SEC. 1090. AMENDMENTS TO THE FEDERAL DEPOSIT INSURANCE ACT.

       The Federal Deposit Insurance Act (12 U.S.C. 1811 et seq.) 
     is amended--
       (1) in section 8(t) (12 U.S.C. 1818(t)), by adding at the 
     end the following:
       ``(6) Referral to bureau of consumer financial 
     protection.--Subject to subtitle B of the Consumer Financial 
     Protection Act of 2010, each appropriate Federal banking 
     agency shall make a referral to the Bureau of Consumer 
     Financial Protection when the Federal banking agency has a 
     reasonable belief that a violation of an enumerated consumer 
     law, as defined in the Consumer Financial Protection Act of 
     2010, has been committed by any insured depository 
     institution or institution-affiliated party within the 
     jurisdiction of that appropriate Federal banking agency.''; 
     and
       (2) in section 43 (12 U.S.C. 1831t)--
       (A) in subsection (c), by striking ``Federal Trade 
     Commission'' and inserting ``Bureau'';
       (B) in subsection (d), by striking ``Federal Trade 
     Commission'' and inserting ``Bureau'';
       (C) in subsection (e)--
       (i) in paragraph (2), by striking ``Federal Trade 
     Commission'' and inserting ``Bureau''; and
       (ii) by adding at the end the following new paragraph:
       ``(5) Bureau.--The term `Bureau' means the Bureau of 
     Consumer Financial Protection.''; and
       (D) in subsection (f)--

[[Page S3257]]

       (i) by striking paragraph (1) and inserting the following:
       ``(1) Limited enforcement authority.--Compliance with the 
     requirements of subsections (b), (c), and (e), and any 
     regulation prescribed or order issued under such subsection, 
     shall be enforced under the Consumer Financial Protection Act 
     of 2010, by the Bureau, subject to subtitle B of the Consumer 
     Financial Protection Act of 2010, and under the Federal Trade 
     Commission Act (15 U.S.C. 41 et seq.) by the Federal Trade 
     Commission.''; and
       (ii) in paragraph (2), by striking subparagraph (C) and 
     inserting the following:
       ``(C) Limitation on state action while federal action 
     pending.--If the Bureau or Federal Trade Commission has 
     instituted an enforcement action for a violation of this 
     section, no appropriate State supervisory agency may, during 
     the pendency of such action, bring an action under this 
     section against any defendant named in the complaint of the 
     Bureau or Federal Trade Commission for any violation of this 
     section that is alleged in that complaint.''.

     SEC. 1091. AMENDMENTS TO THE GRAMM-LEACH-BLILEY ACT.

       Title V of the Gramm-Leach-Bliley Act (15 U.S.C. 6801 et 
     seq.) is amended--
       (1) in section 504(a)(1) (15 U.S.C. 6804(a)(1))--
       (A) by striking ``The Federal banking agencies, the 
     National Credit Union Administration, the Secretary of the 
     Treasury,'' and inserting ``The Bureau of Consumer Financial 
     Protection and''; and
       (B) by striking ``, and the Federal Trade Commission'';
       (2) in section 505(a) (15 U.S.C. 6805(a))--
       (A) by striking ``This subtitle'' and all that follows 
     through ``as follows:'' and inserting ``Except as otherwise 
     provided by subtitle B of the Consumer Financial Protection 
     Act of 2010, this subtitle and the regulations prescribed 
     thereunder shall be enforced by the Bureau of Consumer 
     Financial Protection, the Federal functional regulators, the 
     State insurance authorities, and the Federal Trade Commission 
     with respect to financial institutions and other persons 
     subject to their jurisdiction under applicable law, as 
     follows:'';
       (B) in paragraph (1)--
       (i) in subparagraph (B), by inserting ``and'' after the 
     semicolon;
       (ii) in subparagraph (C), by striking ``; and'' and 
     inserting a period; and
       (iii) by striking subparagraph (D); and
       (C) by adding at the end the following:
       ``(8) Under the Consumer Financial Protection Act of 2010, 
     by the Bureau of Consumer Financial Protection, in the case 
     of any financial institution and other covered person or 
     service provider that is subject to the jurisdiction of the 
     Bureau under that Act, but not with respect to the standards 
     under section 501.''; and
       (3) in section 505(b)(1) (15 U.S.C. 6805(b)(1)), by 
     inserting ``, other than the Bureau of Consumer Financial 
     Protection,'' after ``subsection (a)''.

     SEC. 1092. AMENDMENTS TO THE HOME MORTGAGE DISCLOSURE ACT.

       The Home Mortgage Disclosure Act of 1975 (12 U.S.C. 2801 et 
     seq.) is amended--
       (1) except as otherwise specifically provided in this 
     section, by striking ``Board'' each place that term appears 
     and inserting ``Bureau'';
       (2) in section 303 (12 U.S.C. 2802)--
       (A) by redesignating paragraphs (1) through (6) as 
     paragraphs (2) through (7), respectively; and
       (B) by inserting before paragraph (2) the following:
       ``(1) the term `Bureau' means the Bureau of Consumer 
     Financial Protection;'';
       (3) in section 304 (12 U.S.C. 2803)--
       (A) in subsection (b)--
       (i) in paragraph (4), by inserting ``age,'' before ``and 
     gender'';
       (ii) in paragraph (3), by striking ``and'' at the end;
       (iii) in paragraph (4), by striking the period at the end 
     and inserting a semicolon; and
       (iv) by adding at the end the following:
       ``(5) the number and dollar amount of mortgage loans 
     grouped according to measurements of--
       ``(A) the total points and fees payable at origination in 
     connection with the mortgage as determined by the Bureau, 
     taking into account 15 U.S.C. 1602(aa)(4);
       ``(B) the difference between the annual percentage rate 
     associated with the loan and a benchmark rate or rates for 
     all loans;
       ``(C) the term in months of any prepayment penalty or other 
     fee or charge payable on repayment of some portion of 
     principal or the entire principal in advance of scheduled 
     payments; and
       ``(D) such other information as the Bureau may require; and
       ``(6) the number and dollar amount of mortgage loans and 
     completed applications grouped according to measurements of--
       ``(A) the value of the real property pledged or proposed to 
     be pledged as collateral;
       ``(B) the actual or proposed term in months of any 
     introductory period after which the rate of interest may 
     change;
       ``(C) the presence of contractual terms or proposed 
     contractual terms that would allow the mortgagor or applicant 
     to make payments other than fully amortizing payments during 
     any portion of the loan term;
       ``(D) the actual or proposed term in months of the mortgage 
     loan;
       ``(E) the channel through which application was made, 
     including retail, broker, and other relevant categories;
       ``(F) as the Bureau may determine to be appropriate, a 
     unique identifier that identifies the loan originator as set 
     forth in section 1503 of the S.A.F.E. Mortgage Licensing Act 
     of 2008;
       ``(G) as the Bureau may determine to be appropriate, a 
     universal loan identifier;
       ``(H) as the Bureau may determine to be appropriate, the 
     parcel number that corresponds to the real property pledged 
     or proposed to be pledged as collateral;
       ``(I) the credit score of mortgage applicants and 
     mortgagors, in such form as the Bureau may prescribe, except 
     that the Bureau shall modify or require modification of 
     credit score data that is or will be available to the public 
     to protect the compelling privacy interest of the mortgage 
     applicant or mortgagors; and
       ``(J) such other information as the Bureau may require.'';
       (B) in subsection (i), by striking ``subsection (b)(4)'' 
     and inserting ``subsections (b)(4), (b)(5), and (b)(6)'';
       (C) in subsection (j)--
       (i) in paragraph (1), by striking ``(as'' and inserting 
     ``(containing loan-level and application-level information 
     relating to disclosures required under subsections (a) and 
     (b) and as otherwise'';
       (ii) by striking paragraph (3) and inserting the following:
       ``(3) Change of form not required.--A depository 
     institution meets the disclosure requirement of paragraph (1) 
     if the institution provides the information required under 
     such paragraph in such formats as the Bureau may require''; 
     and
       (iii) in paragraph (2)(A), by striking ``in the format in 
     which such information is maintained by the institution'' and 
     inserting ``in such formats as the Bureau may require'';
       (D) in subsection (m), by striking paragraph (2) and 
     inserting the following:
       ``(2) Form of information.--In complying with paragraph 
     (1), a depository institution shall provide the person 
     requesting the information with a copy of the information 
     requested in such formats as the Bureau may require'';
       (E) by striking subsection (h) and inserting the following:
       ``(h) Submission to Agencies.--
       ``(1) In general.--The data required to be disclosed under 
     subsection (b) shall be submitted to the Bureau or to the 
     appropriate agency for the institution reporting under this 
     title, in accordance with rules prescribed by the Bureau. 
     Notwithstanding the requirement of subsection (a)(2)(A) for 
     disclosure by census tract, the Bureau, in cooperation with 
     other appropriate regulators described in paragraph (2), 
     shall develop regulations that--
       ``(A) prescribe the format for such disclosures, the method 
     for submission of the data to the appropriate regulatory 
     agency, and the procedures for disclosing the information to 
     the public;
       ``(B) require the collection of data required to be 
     disclosed under subsection (b) with respect to loans sold by 
     each institution reporting under this title;
       ``(C) require disclosure of the class of the purchaser of 
     such loans; and
       ``(D) permit any reporting institution to submit in writing 
     to the Bureau or to the appropriate agency such additional 
     data or explanations as it deems relevant to the decision to 
     originate or purchase mortgage loans.
       ``(2) Other appropriate agencies.--The appropriate 
     regulators described in this paragraph are--
       ``(A) the Office of the Comptroller of the Currency 
     (hereafter referred to in this Act as `Comptroller') for 
     national banks and Federal branches, Federal agencies of 
     foreign banks, and savings associations;
       ``(B) the Federal Deposit Insurance Corporation for banks 
     insured by the Federal Deposit Insurance Corporation (other 
     than members of the Federal Reserve System), mutual savings 
     banks, insured State branches of foreign banks, and any other 
     depository institution described in section 303(2)(A) which 
     is not otherwise referred to in this paragraph;
       ``(C) the National Credit Union Administration Board for 
     credit unions; and
       ``(D) the Secretary of Housing and Urban Development for 
     other lending institutions not regulated by the agencies 
     referred to in subparagraphs (A) through (C).''; and
       (F) by adding at the end the following:
       ``(n) Timing of Certain Disclosures.--The data required to 
     be disclosed under subsection (b) shall be submitted to the 
     Bureau or to the appropriate agency for any institution 
     reporting under this title, in accordance with regulations 
     prescribed by the Bureau. Institutions shall not be required 
     to report new data under paragraph (5) or (6) of subsection 
     (b) before the first January 1 that occurs after the end of 
     the 9-month period beginning on the date on which regulations 
     are issued by the Bureau in final form with respect to such 
     disclosures.'';
       (4) in section 305 (12 U.S.C. 2804)--
       (A) by striking subsection (b) and inserting the following:
       ``(b) Powers of Certain Other Agencies.--
       ``(1) In general.--Except as otherwise provided by subtitle 
     B of the Consumer Financial Protection Act of 2010, 
     compliance with the requirements of this title shall be 
     enforced--
       ``(A) under section 8 of the Federal Deposit Insurance Act, 
     in the case of--
       ``(i) any national bank, and any Federal branch or Federal 
     agency of a foreign bank,

[[Page S3258]]

     by the Office of the Comptroller of the Currency;
       ``(ii) any member bank of the Federal Reserve System (other 
     than a national bank), branch or agency of a foreign bank 
     (other than a Federal branch, Federal agency, and insured 
     State branch of a foreign bank), commercial lending company 
     owned or controlled by a foreign bank, and any organization 
     operating under section 25 or 25(a) of the Federal Reserve 
     Act, by the Board; and
       ``(iii) any bank insured by the Federal Deposit Insurance 
     Corporation (other than a member of the Federal Reserve 
     System), any mutual savings bank as, defined in section 3(f) 
     of the Federal Deposit Insurance Act (12 U.S.C. 1813(f)), any 
     insured State branch of a foreign bank, and any other 
     depository institution not referred to in this paragraph or 
     subparagraph (B) or (C), by the Federal Deposit Insurance 
     Corporation;
       ``(B) under subtitle E of the Consumer Financial Protection 
     Act of 2010, by the Bureau;
       ``(C) under the Federal Credit Union Act, by the 
     Administrator of the National Credit Union Administration 
     with respect to any insured credit union; and
       ``(D) with respect to other lending institutions, by the 
     Secretary of Housing and Urban Development.
       ``(2) Incorporated definitions.--The terms used in 
     paragraph (1) that are not defined in this title or otherwise 
     defined in section 3(s) of the Federal Deposit Insurance Act 
     (12 U.S.C. 1813(s)) shall have the same meanings as in 
     section 1(b) of the International Banking Act of 1978 (12 
     U.S.C. 3101).''; and
       (B) by adding at the end the following:
       ``(d) Overall Enforcement Authority of the Bureau of 
     Consumer Financial Protection.--Subject to subtitle B of the 
     Consumer Financial Protection Act of 2010, enforcement of the 
     requirements imposed under this title is committed to each of 
     the agencies under subsection (b). The Bureau may exercise 
     its authorities under the Consumer Financial Protection Act 
     of 2010 to exercise principal authority to examine and 
     enforce compliance by any person with the requirements of 
     this title.'';
       (5) in section 306 (12 U.S.C. 2805(b)), by striking 
     subsection (b) and inserting the following:
       ``(b) Exemption Authority.--The Bureau may, by regulation, 
     exempt from the requirements of this title any State-
     chartered depository institution within any State or 
     subdivision thereof, if the agency determines that, under the 
     law of such State or subdivision, that institution is subject 
     to requirements that are substantially similar to those 
     imposed under this title, and that such law contains adequate 
     provisions for enforcement. Notwithstanding any other 
     provision of this subsection, compliance with the 
     requirements imposed under this subsection shall be enforced 
     by the Office of the Comptroller of the Currency under 
     section 8 of the Federal Deposit Insurance Act, in the case 
     of national banks and savings associations, the deposits of 
     which are insured by the Federal Deposit Insurance 
     Corporation.''; and
       (6) by striking section 307 (12 U.S.C. 2806) and inserting 
     the following:

     ``SEC. 307. COMPLIANCE IMPROVEMENT METHODS.

       ``(a) In General.--
       ``(1) Consultation required.--The Director of the Bureau of 
     Consumer Financial Protection, with the assistance of the 
     Secretary, the Director of the Bureau of the Census, the 
     Board of Governors of the Federal Reserve System, the Federal 
     Deposit Insurance Corporation, and such other persons as the 
     Bureau deems appropriate, shall develop or assist in the 
     improvement of, methods of matching addresses and census 
     tracts to facilitate compliance by depository institutions in 
     as economical a manner as possible with the requirements of 
     this title.
       ``(2) Authorization of appropriations.--There are 
     authorized to be appropriated, such sums as may be necessary 
     to carry out this subsection.
       ``(3) Contracting authority.--The Director of the Bureau of 
     Consumer Financial Protection is authorized to utilize, 
     contract with, act through, or compensate any person or 
     agency in order to carry out this subsection.
       ``(b) Recommendations to Congress.--The Director of the 
     Bureau of Consumer Financial Protection shall recommend to 
     the Committee on Banking, Housing, and Urban Affairs of the 
     Senate and the Committee on Financial Services of the House 
     of Representatives, such additional legislation as the 
     Director of the Bureau of Consumer Financial Protection deems 
     appropriate to carry out the purpose of this title.''.

     SEC. 1093. AMENDMENTS TO THE HOMEOWNERS PROTECTION ACT OF 
                   1998.

       Section 10 of the Homeowners Protection Act of 1998 (12 
     U.S.C. 4909) is amended--
       (1) in subsection (a)--
       (A) by striking ``Compliance'' and inserting ``Except as 
     otherwise provided by subtitle B of the Consumer Financial 
     Protection Act of 2010, compliance'';
       (B) in paragraph (2), by striking ``and'' at the end;
       (C) in paragraph (3), by striking the period at the end and 
     inserting ``; and''; and
       (D) by adding at the end the following:
       ``(4) subtitle E of the Consumer Financial Protection Act 
     of 2010, by the Bureau of Consumer Financial Protection.''; 
     and
       (2) in subsection (b)(2), by inserting before the period at 
     the end the following: ``, subject to subtitle B of the 
     Consumer Financial Protection Act of 2010''.

     SEC. 1094. AMENDMENTS TO THE HOME OWNERSHIP AND EQUITY 
                   PROTECTION ACT OF 1994.

       The Home Ownership and Equity Protection Act of 1994 (15 
     U.S.C. 1601 note) is amended--
       (1) in section 158(a), by striking ``Consumer Advisory 
     Council of the Board'' and inserting ``Advisory Board to the 
     Bureau''; and
       (2) by striking ``Board'' each place that term appears and 
     inserting ``Bureau''.

     SEC. 1095. AMENDMENTS TO THE OMNIBUS APPROPRIATIONS ACT, 
                   2009.

       Section 626 of the Omnibus Appropriations Act, 2009 (15 
     U.S.C. 1638 note) is amended--
       (1) by striking subsection (a) and inserting the following:
       ``(a)(1) The Bureau of Consumer Financial Protection shall 
     have authority to prescribe rules with respect to mortgage 
     loans in accordance with section 553 of title 5, United 
     States Code. Such rulemaking shall relate to unfair or 
     deceptive acts or practices regarding mortgage loans, which 
     may include unfair or deceptive acts or practices involving 
     loan modification and foreclosure rescue services. Any 
     violation of a rule prescribed under this paragraph shall be 
     treated as a violation of a rule prohibiting unfair, 
     deceptive, or abusive acts or practices under the Consumer 
     Financial Protection Act of 2010 and a violation of a rule 
     under section 18 of the Federal Trade Commission Act (15 
     U.S.C. 57a) regarding unfair or deceptive acts or practices.
       ``(2) The Bureau of Consumer Financial Protection shall 
     enforce the rules issued under paragraph (1) in the same 
     manner, by the same means, and with the same jurisdiction, 
     powers, and duties, as though all applicable terms and 
     provisions of the Consumer Financial Protection Act of 2010 
     were incorporated into and made part of this subsection.''; 
     and
       (2) in subsection (b)--
       (A) by striking paragraph (1) and inserting the following:
       ``(1) Except as provided in paragraph (6), in any case in 
     which the attorney general of a State has reason to believe 
     that an interest of the residents of the State has been or is 
     threatened or adversely affected by the engagement of any 
     person subject to a rule prescribed under subsection (a) in 
     practices that violate such rule, the State, as parens 
     patriae, may bring a civil action on behalf of its residents 
     in an appropriate district court of the United States or 
     other court of competent jurisdiction--
       ``(A) to enjoin that practice;
       ``(B) to enforce compliance with the rule;
       ``(C) to obtain damages, restitution, or other compensation 
     on behalf of the residents of the State; or
       ``(D) to obtain penalties and relief provided under the 
     Consumer Financial Protection Act of 2010, the Federal Trade 
     Commission Act, and such other relief as the court deems 
     appropriate.'';
       (B) in paragraphs (2) and (3), by striking ``the primary 
     Federal regulator'' each time the term appears and inserting 
     ``the Bureau of Consumer Financial Protection or the 
     Commission, as appropriate'';
       (C) in paragraph (3), by inserting ``and subject to 
     subtitle B of the Consumer Financial Protection Act of 
     2010,'' after ``paragraph (2),''; and
       (D) in paragraph (6), by striking ``the primary Federal 
     regulator'' each place that term appears and inserting ``the 
     Bureau of Consumer Financial Protection or the Commission''.

     SEC. 1096. AMENDMENTS TO THE REAL ESTATE SETTLEMENT 
                   PROCEDURES ACT.

       The Real Estate Settlement Procedures Act of 1974 (12 
     U.S.C. 2601 et seq.) is amended--
       (1) in section 3 (12 U.S.C. 2602)--
       (A) in paragraph (7), by striking ``and'' at the end;
       (B) in paragraph (8), by striking the period at the end and 
     inserting ``; and''; and
       (C) by adding at the end the following:
       ``(9) the term `Bureau' means the Bureau of Consumer 
     Financial Protection.'';
       (2) in section 4 (12 U.S.C. 2603)--
       (A) in subsection (a), by striking the first sentence and 
     inserting the following: ``The Bureau shall publish a single, 
     integrated disclosure for mortgage loan transactions 
     (including real estate settlement cost statements) which 
     includes the disclosure requirements of this title, in 
     conjunction with the disclosure requirements of the Truth in 
     Lending Act that, taken together, may apply to a transaction 
     that is subject to both or either provisions of law. The 
     purpose of such model disclosure shall be to facilitate 
     compliance with the disclosure requirements of this title and 
     the Truth in Lending Act, and to aid the borrower or lessee 
     in understanding the transaction by utilizing readily 
     understandable language to simplify the technical nature of 
     the disclosures.'';
       (B) by striking ``Secretary'' each place that term appears 
     and inserting ``Bureau''; and
       (C) by striking ``form'' each place that term appears and 
     inserting ``forms'';
       (3) in section 5 (12 U.S.C. 2604)--
       (A) by striking ``Secretary'' each place that term appears 
     and inserting ``Bureau''; and
       (B) in subsection (a), by striking the first sentence and 
     inserting the following: ``The Bureau shall prepare and 
     distribute booklets jointly addressing compliance with the 
     requirements of the Truth in Lending Act and the provisions 
     of this title, in order to help

[[Page S3259]]

     persons borrowing money to finance the purchase of 
     residential real estate better to understand the nature and 
     costs of real estate settlement services.'';
       (4) in section 6(j)(3) (12 U.S.C. 2605(j)(3))--
       (A) by striking ``Secretary'' and inserting ``Bureau''; and
       (B) by striking ``, by regulations that shall take effect 
     not later than April 20, 1991,'';
       (5) in section 7(b) (12 U.S.C. 2606(b)) by striking 
     ``Secretary'' and inserting ``Bureau'';
       (6) in section 8(d) (12 U.S.C. 2607(d))--
       (A) in the subsection heading, by inserting ``Bureau and'' 
     before ``Secretary''; and
       (B) by striking paragraph (4), and inserting the following:
       ``(4) The Bureau, the Secretary, or the attorney general or 
     the insurance commissioner of any State may bring an action 
     to enjoin violations of this section. Except, to the extent 
     that a person is subject to the jurisdiction of the Bureau, 
     the Secretary, or the attorney general or the insurance 
     commissioner of any State, the Bureau shall have primary 
     authority to enforce or administer this section, subject to 
     subtitle B of the Consumer Financial Protection Act of 
     2010.''.
       (7) in section 10(c) (12 U.S.C. 2609(c) and (d)), by 
     striking ``Secretary'' and inserting ``Bureau'';
       (8) in section 16 (12 U.S.C. 2614), by inserting ``the 
     Bureau,'' before ``the Secretary'';
       (9) in section 18 (12 U.S.C. 2616), by striking 
     ``Secretary'' each place that term appears and inserting 
     ``Bureau''; and
       (10) in section 19 (12 U.S.C. 2617)--
       (A) in the section heading by striking ``SECRETARY'' and 
     inserting ``BUREAU'';
       (B) by striking ``Secretary'' each place that term appears 
     and inserting ``Bureau'';
       (C) in subsection (b), by inserting ``the Bureau'' before 
     ``the Secretary''; and
       (D) in subsection (c), by inserting ``or the Bureau'' after 
     ``the Secretary'' each time that term appears.

     SEC. 1097. AMENDMENTS TO THE RIGHT TO FINANCIAL PRIVACY ACT 
                   OF 1978.

       The Right to Financial Privacy Act of 1978 (12 U.S.C. 3401 
     et seq.) is amended--
       (1) in section 1101--
       (A) in paragraph (6)--
       (i) in subparagraph (A), by inserting ``and'' after the 
     semicolon;
       (ii) in subparagraph (B), by striking ``and'' at the end; 
     and
       (iii) by striking subparagraph (C); and
       (B) in paragraph (7), by striking subparagraph (E), and 
     inserting the following:
       ``(E) the Bureau of Consumer Financial Protection;'';
       (2) in section 1112(e) (12 U.S.C. 3412(e)), by striking 
     ``and the Commodity Futures Trading Commission is permitted'' 
     and inserting ``the Commodity Futures Trading Commission, and 
     the Bureau of Consumer Financial Protection is permitted''; 
     and
       (3) in section 1113 (12 U.S.C. 3413), by adding at the end 
     the following new subsection:
       ``(r) Disclosure to the Bureau of Consumer Financial 
     Protection.--Nothing in this title shall apply to the 
     examination by or disclosure to the Bureau of Consumer 
     Financial Protection of financial records or information in 
     the exercise of its authority with respect to a financial 
     institution.''.

     SEC. 1098. AMENDMENTS TO THE SECURE AND FAIR ENFORCEMENT FOR 
                   MORTGAGE LICENSING ACT OF 2008.

       The S.A.F.E. Mortgage Licensing Act of 2008 (12 U.S.C. 5101 
     et seq.) is amended--
       (1) by striking ``a Federal banking agency'' each place 
     that term appears, other than in paragraphs (7) and (11) of 
     section 1503 and section 1507(a)(1), and inserting ``the 
     Bureau'';
       (2) by striking ``Federal banking agencies'' each place 
     that term appears and inserting ``Bureau''; and
       (3) by striking ``Secretary'' each place that term appears 
     and inserting ``Director'';
       (4) in section 1503 (12 U.S.C. 5102)--
       (A) by redesignating paragraphs (2) through (12) as (3) 
     through (13), respectively;
       (B) by striking paragraph (1) and inserting the following:
       ``(1) Bureau.--The term `Bureau' means the Bureau of 
     Consumer Financial Protection.
       ``(2) Federal banking agency.--The term `Federal banking 
     agency' means the Board of Governors of the Federal Reserve 
     System, the Office of the Comptroller of the Currency, the 
     National Credit Union Administration, and the Federal Deposit 
     Insurance Corporation.''; and
       (C) by striking paragraph (10), as so designated by this 
     section, and inserting the following:
       ``(10) Director.--The term `Director' means the Director of 
     the Bureau of Consumer Financial Protection.''; and
       (5) in section 1507 (12 U.S.C. 5106)--
       (A) in subsection (a)--
       (i) by striking paragraph (1) and inserting the following:
       ``(1) In general.--The Bureau shall develop and maintain a 
     system for registering employees of a depository institution, 
     employees of a subsidiary that is owned and controlled by a 
     depository institution and regulated by a Federal banking 
     agency, or employees of an institution regulated by the Farm 
     Credit Administration, as registered loan originators with 
     the Nationwide Mortgage Licensing System and Registry. The 
     system shall be implemented before the end of the 1-year 
     period beginning on the date of enactment of the Consumer 
     Financial Protection Act of 2010.''; and
       (ii) in paragraph (2)--

       (I) by striking ``appropriate Federal banking agency and 
     the Farm Credit Administration'' and inserting ``Bureau''; 
     and
       (II) by striking ``employees's identity'' and inserting 
     ``identity of the employee''; and

       (B) in subsection (b), by striking ``through the Financial 
     Institutions Examination Council, and the Farm Credit 
     Administration'', and inserting ``and the Bureau of Consumer 
     Financial Protection'';
       (6) in section 1508 (12 U.S.C. 5107)--
       (A) by striking the section heading and inserting the 
     following: ``SEC. 1508. BUREAU OF CONSUMER FINANCIAL 
     PROTECTION BACKUP AUTHORITY TO ESTABLISH LOAN ORIGINATOR 
     LICENSING SYSTEM.''; and
       (B) by adding at the end the following:
       ``(f) Regulation Authority.--
       ``(1) In general.--The Bureau is authorized to promulgate 
     regulations setting minimum net worth or surety bond 
     requirements for residential mortgage loan originators and 
     minimum requirements for recovery funds paid into by loan 
     originators.
       ``(2) Considerations.--In issuing regulations under 
     paragraph (1), the Bureau shall take into account the need to 
     provide originators adequate incentives to originate 
     affordable and sustainable mortgage loans, as well as the 
     need to ensure a competitive origination market that 
     maximizes consumer access to affordable and sustainable 
     mortgage loans.'';
       (7) by striking section 1510 (12 U.S.C. 5109) and inserting 
     the following:

     ``SEC. 1510. FEES.

       ``The Bureau, the Farm Credit Administration, and the 
     Nationwide Mortgage Licensing System and Registry may charge 
     reasonable fees to cover the costs of maintaining and 
     providing access to information from the Nationwide Mortgage 
     Licensing System and Registry, to the extent that such fees 
     are not charged to consumers for access to such system and 
     registry.'';
       (8) by striking section 1513 (12 U.S.C. 5112) and inserting 
     the following:

     ``SEC. 1513. LIABILITY PROVISIONS.

       ``The Bureau, any State official or agency, or any 
     organization serving as the administrator of the Nationwide 
     Mortgage Licensing System and Registry or a system 
     established by the Director under section 1509, or any 
     officer or employee of any such entity, shall not be subject 
     to any civil action or proceeding for monetary damages by 
     reason of the good faith action or omission of any officer or 
     employee of any such entity, while acting within the scope of 
     office or employment, relating to the collection, furnishing, 
     or dissemination of information concerning persons who are 
     loan originators or are applying for licensing or 
     registration as loan originators.''; and
       (9) in section 1514 (12 U.S.C. 5113) in the section 
     heading, by striking ``UNDER HUD BACKUP LICENSING SYSTEM'' 
     and inserting ``BY THE BUREAU''.

     SEC. 1099. AMENDMENTS TO THE TRUTH IN LENDING ACT.

       The Truth in Lending Act (15 U.S.C. 1601 et seq.) is 
     amended--
       (1) in section 103 (5 U.S.C. 1602)--
       (A) by redesignating subsections (b) through (bb) as 
     subsections (c) through (cc), respectively; and
       (B) by inserting after subsection (a) the following:
       ``(b) Bureau.--The term `Bureau' means the Bureau of 
     Consumer Financial Protection.'';
       (2) by striking ``Board'' each place that term appears, 
     other than in section 140(d) and section 108(a), as amended 
     by this section, and inserting ``Bureau'';
       (3) by striking ``Federal Trade Commission'' each place 
     that term appears, other than in section 108(c) and section 
     129(m), as amended by this Act, and other than in the context 
     of a reference to the Federal Trade Commission Act, and 
     inserting ``Bureau'';
       (4) in section 105(a) (15 U.S.C. 1604(a)), in the second 
     sentence--
       (A) by striking ``Except in the case of a mortgage referred 
     to in section 103(aa), these regulations may contain such'' 
     and inserting ``Except with respect to the provisions of 
     section 129 that apply to a mortgage referred to in section 
     103(aa), such regulations may contain such additional 
     requirements,''; and
       (B) by inserting ``all or'' after ``exceptions for'';
       (5) in section 105(b) (15 U.S.C. 1604(b)), by striking the 
     first sentence and inserting the following: ``The Bureau 
     shall publish a single, integrated disclosure for mortgage 
     loan transactions (including real estate settlement cost 
     statements) which includes the disclosure requirements of 
     this title in conjunction with the disclosure requirements of 
     the Real Estate Settlement Procedures Act of 1974 that, taken 
     together, may apply to a transaction that is subject to both 
     or either provisions of law. The purpose of such model 
     disclosure shall be to facilitate compliance with the 
     disclosure requirements of this title and the Real Estate 
     Settlement Procedures Act of 1974, and to aid the borrower or 
     lessee in understanding the transaction by utilizing readily 
     understandable language to simplify the technical nature of 
     the disclosures.'';
       (6) in section 105(f)(1) (15 U.S.C. 1604(f)(1)), by 
     inserting ``all or'' after ``from all or part of this 
     title'';
       (7) in section 108 (15 U.S.C. 1607)--
       (A) by striking subsection (a) and inserting the following:

[[Page S3260]]

       ``(a) Enforcing Agencies.--Except as otherwise provided in 
     subtitle B of the Consumer Financial Protection Act of 2010, 
     compliance with the requirements imposed under this title 
     shall be enforced under--
       ``(1) section 8 of the Federal Deposit Insurance Act, in 
     the case of--
       ``(A) any national bank, and Federal branch or Federal 
     agency of a foreign bank, by the Office of the Comptroller of 
     the Currency;
       ``(B) any member bank of the Federal Reserve System (other 
     than a national bank), any branch or agency of a foreign bank 
     (other than a Federal branch, Federal agency, or insured 
     State branch of a foreign bank), any commercial lending 
     company owned or controlled by a foreign bank, and 
     organizations operating under section 25 or 25(a) of the 
     Federal Reserve Act, by the Board; and
       ``(C) any bank insured by the Federal Deposit Insurance 
     Corporation (other than a member of the Federal Reserve 
     System) and an insured State branch of a foreign bank, by the 
     Board of Directors of the Federal Deposit Insurance 
     Corporation;
       ``(2) subtitle E of the Consumer Financial Protection Act 
     of 2010, by the Bureau;
       ``(3) the Federal Credit Union Act, by the Director of the 
     National Credit Union Administration, with respect to any 
     Federal credit union;
       ``(4) the Federal Aviation Act of 1958, by the Secretary of 
     Transportation, with respect to any air carrier or foreign 
     air carrier subject to that Act;
       ``(5) the Packers and Stockyards Act, 1921 (except as 
     provided in section 406 of that Act), by the Secretary of 
     Agriculture, with respect to any activities subject to that 
     Act; and
       ``(6) the Farm Credit Act of 1971, by the Farm Credit 
     Administration with respect to any Federal land bank, Federal 
     land bank association, Federal intermediate credit bank, or 
     production credit association.''; and
       (B) by striking subsection (c) and inserting the following:
       ``(c) Overall Enforcement Authority of the Federal Trade 
     Commission.--Except to the extent that enforcement of the 
     requirements imposed under this title is specifically 
     committed to some other Government agency under subsection 
     (a), and subject to subtitle B of the Consumer Financial 
     Protection Act of 2010, the Federal Trade Commission shall 
     enforce such requirements. For the purpose of the exercise by 
     the Federal Trade Commission of its functions and powers 
     under the Federal Trade Commission Act, a violation of any 
     requirement imposed under this title shall be deemed a 
     violation of a requirement imposed under that Act. All of the 
     functions and powers of the Federal Trade Commission under 
     the Federal Trade Commission Act are available to the Federal 
     Trade Commission to enforce compliance by any person with the 
     requirements under this title, irrespective of whether that 
     person is engaged in commerce or meets any other 
     jurisdictional tests under the Federal Trade Commission 
     Act.'';
       (8) in section 129 (15 U.S.C. 1639), by striking subsection 
     (m) and inserting the following:
       ``(m) Civil Penalties in Federal Trade Commission 
     Enforcement Actions.--For purposes of enforcement by the 
     Federal Trade Commission, any violation of a regulation 
     issued by the Bureau pursuant to subsection (l)(2) shall be 
     treated as a violation of a rule promulgated under section 18 
     of the Federal Trade Commission Act (15 U.S.C. 57a) regarding 
     unfair or deceptive acts or practices.''; and
       (9) in chapter 5 (15 U.S.C. 1667 et seq.)--
       (A) by striking ``the Board'' each place that term appears 
     and inserting ``the Bureau''; and
       (B) by striking ``The Board'' each place that term appears 
     and inserting ``The Bureau''.

     SEC. 1100. AMENDMENTS TO THE TRUTH IN SAVINGS ACT.

       The Truth in Savings Act (12 U.S.C. 4301 et seq.) is 
     amended--
       (1) by striking ``Board'' each place that term appears and 
     inserting ``Bureau'';
       (2) in section 270(a) (12 U.S.C. 4309)--
       (A) by striking ``Compliance'' and inserting ``Except as 
     otherwise provided in subtitle B of the Consumer Financial 
     Protection Act of 2010, compliance'';
       (B) in paragraph (1)--
       (i) in subparagraph (B), by striking ``and'' at the end; 
     and
       (ii) by striking subparagraph (C);
       (C) in paragraph (2), by striking the period at the end and 
     inserting ``; and''; and
       (D) by adding at the end the following:
       ``(3) subtitle E of the Consumer Financial Protection Act 
     of 2010, by the Bureau.'';
       (3) in section 272(b) (12 U.S.C. 4311(b)), by striking 
     ``regulation prescribed by the Board'' each place that term 
     appears and inserting ``regulation prescribed by the 
     Bureau''; and
       (4) in section 274 (12 U.S.C. 4313), by striking paragraph 
     (4) and inserting the following:
       ``(4) Bureau.--The term `Bureau' means the Bureau of 
     Consumer Financial Protection.''.

     SEC. 1101. AMENDMENTS TO THE TELEMARKETING AND CONSUMER FRAUD 
                   AND ABUSE PREVENTION ACT.

       (a) Amendments to Section 3.--Section 3 of the 
     Telemarketing and Consumer Fraud and Abuse Prevention Act (15 
     U.S.C. 6102) is amended by striking subsections (b) and (c) 
     and inserting the following:
       ``(b) Rulemaking Authority.--The Commission shall have 
     authority to prescribe rules under subsection (a), in 
     accordance with section 553 of title 5, United States Code. 
     In prescribing a rule under this section that relates to the 
     provision of a consumer financial product or service that is 
     subject to the Consumer Financial Protection Act of 2010, 
     including any enumerated consumer law thereunder, the 
     Commission shall consult with the Bureau of Consumer 
     Financial Protection regarding the consistency of a proposed 
     rule with standards, purposes, or objectives administered by 
     the Bureau of Consumer Financial Protection.
       ``(c) Violations.--Any violation of any rule prescribed 
     under subsection (a)--
       ``(1) shall be treated as a violation of a rule under 
     section 18 of the Federal Trade Commission Act regarding 
     unfair or deceptive acts or practices; and
       ``(2) that is committed by a person subject to the Consumer 
     Financial Protection Act of 2010 shall be treated as a 
     violation of a rule under section 1031 of that Act regarding 
     unfair, deceptive, or abusive acts or practices.''.
       (b) Amendments to Section 4.--Section 4(d) of the 
     Telemarketing and Consumer Fraud and Abuse Prevention Act (15 
     U.S.C. 6103(d)) is amended by inserting after ``Commission'' 
     each place that term appears the following: ``or the Bureau 
     of Consumer Financial Protection''.
       (c) Amendments to Section 5.--Section 5(c) of the 
     Telemarketing and Consumer Fraud and Abuse Prevention Act (15 
     U.S.C. 6104(c)) is amended by inserting after ``Commission'' 
     each place that term appears the following: ``or the Bureau 
     of Consumer Financial Protection''.
       (d) Amendment to Section 6.--Section 6 of the Telemarketing 
     and Consumer Fraud and Abuse Prevention Act (15 U.S.C. 6105) 
     is amended by adding at the end the following:
       ``(d) Enforcement by Bureau of Consumer Financial 
     Protection.--Except as otherwise provided in sections 3(d), 
     3(e), 4, and 5, and subject to subtitle B of the Consumer 
     Financial Protection Act of 2010, this Act shall be enforced 
     by the Bureau of Consumer Financial Protection under subtitle 
     E of the Consumer Financial Protection Act of 2010.''.

     SEC. 1102. AMENDMENTS TO THE PAPERWORK REDUCTION ACT.

       (a) Designation as an Independent Agency.--Section 2(5) of 
     the Paperwork Reduction Act (44 U.S.C. 3502(5)) is amended by 
     inserting ``the Bureau of Consumer Financial Protection, the 
     Office of Financial Research,'' after ``the Securities and 
     Exchange Commission,''.
       (b) Comparable Treatment.--Section 3513 of title 44, United 
     States Code, is amended by adding at the end the following:
       ``(c) Comparable Treatment.--Notwithstanding any other 
     provision of law, the Director shall treat or review a rule 
     or order prescribed or proposed by the Director of the Bureau 
     of Consumer Financial Protection on the same terms and 
     conditions as apply to any rule or order prescribed or 
     proposed by the Board of Governors of the Federal Reserve 
     System.''.

     SEC. 1103. ADJUSTMENTS FOR INFLATION IN THE TRUTH IN LENDING 
                   ACT.

       (a) Caps.--
       (1) Credit transactions.--Section 104(3) of the Truth in 
     Lending Act (15 U.S.C. 1603(3)) is amended by striking 
     ``$25,000'' and inserting ``$50,000''.
       (2) Consumer leases.--Section 181(1) of the Truth in 
     Lending Act (15 U.S.C. 1667(1)) is amended by striking 
     ``$25,000'' and inserting ``$50,000''.
       (b) Adjustments for Inflation.--On and after December 31, 
     2011, the Bureau may adjust annually the dollar amounts 
     described in sections 104(3) and 181(1) of the Truth in 
     Lending Act (as amended by this section), by the annual 
     percentage increase in the Consumer Price Index for Urban 
     Wage Earners and Clerical Workers, as published by the Bureau 
     of Labor Statistics, rounded to the nearest multiple of $100, 
     or $1,000, as applicable.

     SEC. 1104. EFFECTIVE DATE.

       Except as otherwise provided in this subtitle and the 
     amendments made by this subtitle, this subtitle and the 
     amendments made by this subtitle, other than sections 1081 
     and 1082, shall become effective on the designated transfer 
     date.
                                 ______
                                 
  SA 3832. Mr. SESSIONS (for himself, Mr. Bunning, Mr. DeMint, Mr. 
Ensign, and Mr. Brown of Massachusetts) submitted an amendment intended 
to be proposed to amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd 
(for himself and Mrs. Lincoln)) to the bill S. 3217, to promote the 
financial stability of the United States by improving accountability 
and transparency in the financial system, to end ``too big to fail,'' 
to protect the American taxpayer by ending bailouts, to protect 
consumers from abusive financial services practices, and for other 
purposes; which was ordered to lie on the table; as follows:

       Strike title II and insert the following:

         TITLE II--BANKRUPTCY INTEGRITY AND ACCOUNTABILITY ACT

     SEC. 201. SHORT TITLE.

       This title may be cited as the ``Bankruptcy Integrity and 
     Accountability Act of 2010''.

     SEC. 202. AMENDMENTS TO TITLE 28 OF THE UNITED STATES CODE.

       Title 28, United States Code, is amended--

[[Page S3261]]

       (1) in section 1408, by striking ``section 1410'' and 
     inserting ``sections 1409A and 1410'';
       (2) by inserting after section 1409 the following:

     ``Sec. 1409A. Venue of cases involving non-bank financial 
       institutions

       ``A case under chapter 14 may be commenced in the district 
     court of the United States for the district--
       ``(1) in which the debtor has its domicile, principal place 
     of business in the United States, principal assets in the 
     United States, or in which there is pending a case under 
     title 11 concerning the debtor's affiliate or subsidiary, if 
     a Federal Reserve Bank is located in that district;
       ``(2) if venue does not exist under paragraph (1), in which 
     there is a Federal Reserve Bank and in a Federal Reserve 
     district in which the debtor has its domicile, principal 
     place of business in the United States, principal assets in 
     the United States, or in which there is pending a case under 
     title 11 concerning the debtor's affiliate or subsidiary; or
       ``(3) if venue does not exist under paragraph (1) or (2), 
     in which there is a Federal Reserve Bank and in a Federal 
     circuit adjacent to the Federal circuit in which the debtor 
     has its domicile, principal place of business or principal 
     assets in the United States.'', and
       (3) by amending the table of sections for chapter 87, by 
     inserting after the item relating to section 1408 the 
     following:

``1409A. Venue of cases involving non-bank financial institutions.''.

     SEC. 203. AMENDMENTS TO TITLE 11 OF THE UNITED STATES CODE.

       (a) Definitions.--Section 101 of title 11, United States 
     Code, is amended--
       (1) by inserting after paragraph (26) the following:
       ``(26A) The term `functional regulator' means the Federal 
     regulatory agency with the primary Federal regulatory 
     authority over the debtor, such as an agency listed in 
     section 509 of the Gramm-Leach-Bliley Act.'';
       (2) by redesignating paragraphs (38A) and (38B) as 
     paragraphs (38B) and (38C), respectively;
       (3) by inserting after paragraph (38) the following:
       ``(38A) the term `Financial Stability Oversight Council' 
     means the entity established in section 111 of the Restoring 
     American Financial Stability Act of 2010''; and
       (4) by inserting after paragraph (40) the following:
       ``(40A) The term `non-bank financial institution' means an 
     institution the business of which is primarily engaged in 
     financial activities that is not an insured depository 
     institution.''.
       (b) Applicability of Chapters.--Section 103 of title 11, 
     United States Code, is amended--
       (1) in subsection (a) by striking ``13'' and inserting 
     ``13, and 14'';
       (2) by redesignating subsection (k) as subsection (l); and
       (3) by inserting after subsection (j) the following:
       ``(k) Chapter 14 applies only in a case under such 
     chapter.''.
       (c) Who May Be a Debtor.--Section 109 of title 11, United 
     States Code, is amended--
       (1) in subsection (b)--
       (A) in paragraph (2), by striking ``or'' at the end;
       (B) in paragraph (3), by striking the period at the end and 
     inserting ``; or''; and
       (C) by adding at the end the following:
       ``(4) a non-bank financial institution that has not been a 
     debtor under chapter 14 of this title.''; and
       (2) in subsection (d), by striking ``or commodity broker'' 
     and inserting ``, commodity broker, or a non-bank financial 
     institution''.
       (d) Involuntary Cases.--Section 303 of title 11, the United 
     States Code, is amended--
       (1) in subsection (a) by striking ``or 11'' and inserting 
     ``, 11, or 14''; and
       (2) in subsection (b) by striking ``or 11'' and inserting 
     ``, 11, or 14''.
       (e) Obtaining Credit.--Section 364 of title 11, United 
     States Code, is amended by adding at the end the following:
       ``(g) Notwithstanding any other provision of this section, 
     the trustee may not, and the court may not authorize the 
     trustee to, obtain credit, if the source of that credit 
     either directly or indirectly is the United States. Nor shall 
     any Federal funds be made available through the Federal 
     Reserve System, including through the authority of the third 
     undesignated paragraph of section 13 of the Federal Reserve 
     Act (12 U.S.C. 343).''.
       (f) Chapter 14.--Title 11, United States Code, is amended--
       (1) by inserting the following after chapter 13:

     ``CHAPTER 14--ADJUSTMENT TO THE DEBTS OF A NON-BANK FINANCIAL 
                              INSTITUTION

``1401. Inapplicability of other sections.
``1402. Applicability of chapter 11 to cases under this chapter.
``1403. Prepetition consultation.
``1404. Appointment of trustee.
``1405. Right to be heard.
``1406. Right to communicate.
``1407. Exemption with respect to certain contracts or agreements.
``1408. Conversion or dismissal.

     ``Sec. 1401. Inapplicability of other sections

       ``Except as provided in section 1407, sections 362(b)(6), 
     362(b)(7), 362(b)(17), 546(e), 546(f), 546(g), 555, 556, 559, 
     560, and 561 do not apply in a case under this chapter.

     ``Sec. 1402. Applicability of chapter 11 to cases under this 
       chapter

       ``With the exception of sections 1104(d), 1109, 1112(a), 
     1115, and 1116, subchapters I, II, and III of chapter 11 
     apply in a case under this chapter.

     ``Sec. 1403. Prepetition consultation

       ``(a) Subject to subsection (b)--
       ``(1) a non-bank financial institution may not be a debtor 
     under this chapter unless that institution has, at least 10 
     days prior to the date of the filing of the petition by such 
     institution, taken part in the consultation described in 
     subsection (c); and
       ``(2) a creditor may not commence an involuntary case under 
     this chapter unless, at least 10 days prior to the date of 
     the filing of the petition by such creditor, the creditor 
     notifies the non-bank financial institution, the functional 
     regulator, and the Financial Stability Oversight Council of 
     its intent to file a petition and requests a consultation as 
     described in subsection (c).
       ``(b) If the non-bank financial institution, the functional 
     regulator, and the Financial Stability Oversight Council, in 
     consultation with any agency charged with administering a 
     nonbankruptcy insolvency regime for any component of the 
     debtor, certify that the immediate filing of a petition under 
     section 301 or 303 is necessary, or that an immediate filing 
     would be in the interests of justice, a petition may be filed 
     notwithstanding subsection (a).
       ``(c) The non-bank financial institution, the functional 
     regulator, the Financial Stability Oversight Council, and any 
     agency charged with administering a nonbankruptcy insolvency 
     regime for any component of the debtor shall engage in 
     prepetition consultation in order to attempt to avoid the 
     need for the non-bank financial institution's liquidation or 
     reorganization in bankruptcy, to make any liquidation or 
     reorganization of the non-bank financial institution under 
     this title more orderly, or to aid in the nonbankruptcy 
     resolution of any of the non-bank financial institution's 
     components under its nonbankruptcy insolvency regime. Such 
     consultation shall specifically include the attempt to 
     negotiate forbearance of claims between the non-bank 
     financial institution and its creditors if such forbearance 
     would likely help to avoid the commencement of a case under 
     this title, would make any liquidation or reorganization 
     under this title more orderly, or would aid in the 
     nonbankruptcy resolution of any of the non-bank financial 
     institution's components under its nonbankruptcy insolvency 
     regime. Additionally, the consultation shall consider 
     whether, if a petition is filed under section 301 or 303, the 
     debtor should file a motion for an exemption authorized by 
     section 1407.
       ``(d) The court may allow the consultation process to 
     continue for 30 days after the petition, upon motion by the 
     debtor or a creditor. Any post-petition consultation 
     proceedings authorized should be facilitated by the court's 
     mediation services, under seal, and exclude ex parte 
     communications.
       ``(e) The Financial Stability Oversight Council and the 
     functional regulator shall publish and transmit to Congress a 
     report documenting the course of any consultation. Such 
     report shall be published and transmitted to Congress within 
     30 days of the conclusion of the consultation.
       ``(f) Nothing in this section shall be interpreted to set 
     aside any of the limitations on the use of Federal funds set 
     forth in the Bankruptcy Integrity and Accountability Act of 
     2010 or the amendments made by such Act. Nor shall any 
     Federal funds be made available through the Federal Reserve 
     System, including through the authority of the third 
     undesignated paragraph of section 13 of the Federal Reserve 
     Act (12 U.S.C. 343).

     ``Sec. 1404. Appointment of trustee

       ``In applying section 1104 to a case under this chapter, if 
     the court orders the appointment of a trustee or an examiner, 
     if the trustee or an examiner dies or resigns during the case 
     or is removed under section 324, or if a trustee fails to 
     qualify under section 322, the functional regulator, in 
     consultation with the Financial Stability Oversight Council, 
     shall submit a list of five disinterested persons that are 
     qualified and willing to serve as trustees in the case and 
     the United States trustee shall appoint, subject to the 
     court's approval, one of such persons to serve as trustee in 
     the case.

     ``Sec. 1405. Right to be heard

       ``(a) The functional regulator, the Financial Stability 
     Oversight Council, the Federal Reserve, the Department of the 
     Treasury, the Securities and Exchange Commission, and any 
     domestic or foreign agency charged with administering a 
     nonbankruptcy insolvency regime for any component of the 
     debtor may raise and may appear and be heard on any issue in 
     a case under this chapter, but may not appeal from any 
     judgment, order, or decree entered in the case.
       ``(b) A party in interest, including the debtor, the 
     trustee, a creditors' committee, an equity security holders' 
     committee, a creditor, an equity security holder, or any 
     indenture trustee may raise, and may appear and be heard on, 
     any issue in a case under this chapter.

     ``Sec. 1406. Right to communicate

       ``The court is entitled to communicate directly with, or to 
     request information or assistance directly from, the 
     functional regulator, the Financial Stability Oversight

[[Page S3262]]

     Council, the Board of Governors of the Federal Reserve 
     System, the Department of the Treasury, or any agency charged 
     with administering a nonbankruptcy insolvency regime for any 
     component of the debtor, subject to the rights of a party in 
     interest to notice and participation.

     ``Sec. 1407. Exemption with respect to certain contracts or 
       agreements

       ``(a) Subject to subsection (b)--
       ``(1) upon motion of the debtor, consented to by the 
     Financial Stability Oversight Council--
       ``(A) the debtor and the estate shall be exempt from the 
     operation of sections 362(b)(6), 362(b)(7), 362(b)(17), 
     546(e), 546(f), 546(g), 555, 556, 559, 560, and 561;
       ``(B) if the Financial Stability Oversight Council consents 
     to the filing of such motion by the debtor, the Board shall 
     inform the court of its reasons for consenting; and
       ``(C) the debtor may limit its motion, or the board may 
     limit its consent, to exempt the debtor and the estate from 
     the operation of section 362(b)(6), 362(b)(7), 362(b)(17), 
     546(e), 546(f), 546(g), 555, 556, 559, 560, or 561, or any 
     combination thereof; and
       ``(2) if the Financial Stability Oversight Council does not 
     consent to the filing of a motion by the debtor under 
     paragraph (1), the debtor may file a motion to exempt the 
     debtor and the estate from the operation of sections 
     362(b)(6), 362(b)(7), 362(b)(17), 546(e), 546(f), 546(g), 
     555, 556, 559, 560, and 561, or any combination thereof.
       ``(b) The court shall commence a hearing on a motion under 
     subsection (a) not later than 5 days after the filing of the 
     motion to determine whether to maintain, terminate, annul, 
     modify, or condition the exemption under subsection (a)(1) 
     or, in the case of a motion under subsection (a)(2), grant 
     the exemption. The court shall request the filing or briefs 
     by the functional regulator and the Financial Stability 
     Oversight Council. The court shall decide the motion not 
     later than 5 days after commencing such hearing unless--
       ``(1) the parties in interest consent to a extension for a 
     specific period of time; or
       ``(2) except with respect to an exemption from the 
     operation of section 559, the court sua sponte extends for 5 
     additional days the period for decision if such extension 
     would be in the interests of justice or is required by 
     compelling circumstances.
       ``(c) The court shall maintain, terminate, annul, modify, 
     or condition the exemption under subsection (a)(1), or, in 
     the case of a motion under subsection (a)(2), grant the 
     exemption only upon showing of good cause. In determining 
     whether good cause has been shown, the court shall balance 
     the interests of both debtor and creditors while attempting 
     to preserve the debtor's assets for repayment and 
     reorganization of the debtors obligations, or to provide for 
     a more orderly liquidation.
       ``(d) For purposes of timing under section 562 of this 
     title, if a motion is filed under subsection (a)(1) or if a 
     motion is granted under subsection (a)(2), the date or dates 
     of liquidation, termination, or acceleration shall be 
     measured from the earlier of--
       ``(1) the actual date or dates of liquidation, termination, 
     or acceleration; or
       ``(2) the date on which a forward contract merchant, 
     stockbroker, financial institution, securities clearing 
     agency, repo participant, financial participant, master 
     netting agreement participant, or swap participant files a 
     notice with the court that it would have liquidated, 
     terminated, or accelerated a contract or agreement covered by 
     section 562 of this title had a stay under this section not 
     been in place.
       ``(e) The provisions of this section shall apply only with 
     respect to contracts and agreements covered by this section 
     entered into on or after the date of enactment of this 
     chapter.

     ``Sec. 1408. Conversion or dismissal

       ``In applying section 1112 to a case under this chapter, 
     the debtor may convert a case under this chapter to a case 
     under chapter 7 of this title if the debtor may be a debtor 
     under such chapter unless the debtor is not a debtor in 
     possession.'', and
       (2) by amending the table of chapters of such title by 
     adding at the end the following:

``14. Adjustment to the Debts of a Non-Bank Financial Instit1401''.....

                                 ______
                                 
  SA 3833. Mrs. HUTCHISON submitted an amendment intended to be 
proposed to amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for 
himself and Mrs. Lincoln)) to the bill S. 3217, to promote the 
financial stability of the United States by improving accountability 
and transparency in the financial system, to end ``too big to fail'', 
to protect the American taxpayer by ending bailouts, to protect 
consumers from abusive financial services practices, and for other 
purposes; which was ordered to lie on the table; as follows:

       At the appropriate place, insert the following:

     SEC. _. SHAREHOLDER REGISTRATION THRESHOLD.

       (a) Amendments to the Securities Exchange Act of 1934.--
       (1) Section 12.--Section 12(g) of the Securities Exchange 
     Act of 1934 (15 U.S.C. 781(g)) is amended--
       (A) in paragraph (1)--
       (i) by striking subparagraphs (A) and (B) and inserting the 
     following:
       ``(A) in the case of an issuer that is a bank, as such term 
     is defined in section 3(a)(6) of this title, or a bank 
     holding company, as such term is defined in section (2) of 
     the Bank Holding Company Act of 1956 (12 U.S.C. 1841), 2000 
     persons or more; and
       ``(B) in the case of an issuer that is not a bank or bank 
     holding company, 500 persons or more,''; and
       (ii) by striking ``commerce shall'' and inserting 
     ``commerce shall, not later than 120 days after the last day 
     of its first fiscal year ended after the effective date of 
     this subsection, on which the issuer has total assets 
     exceeding $10,000,000 and a class of equity security (other 
     than an exempted security) held of record by''; and
       (B) in paragraph (4), by striking ``three hundred'' and 
     inserting ``300 persons, or, in the case of a bank, as such 
     term is defined in section 3(a)(6) of this title, or a bank 
     holding company, as such term is defined in section (2) of 
     the Bank Holding Company Act of 1956 (12 U.S.C. 1841), 
     1200''.
       (2) Section 15.--Section 15(d) of the Securities Exchange 
     Act of 1934 (15 U.S.C. 78o(d)) is amended, in the third 
     sentence, by striking ``three hundred'' and inserting ``300 
     persons, or, in the case of bank, as such term is defined in 
     section 3(a)(6) of this title, or a bank holding company, as 
     such term is defined in section (2) of the Bank Holding 
     Company Act of 1956 (12 U.S.C. 1841), 1200''.
       (b) Study of Registration Thresholds.--
       (1) Study.--
       (A) Analysis required.--The Chief Economist and Director of 
     the Division of Corporation Finance of the Commission shall 
     jointly conduct a study, including a cost-benefit analysis, 
     of shareholder registration thresholds.
       (B) Costs and benefits.--The cost-benefit analysis under 
     subparagraph (A) shall take into account--
       (i) the incremental benefits to investors of the increased 
     disclosure that results from registration;
       (ii) the incremental costs to issuers associated with 
     registration and reporting requirements; and
       (iii) the incremental administrative costs to the 
     Commission associated with different thresholds.
       (C) Thresholds.--The cost-benefit analysis under 
     subparagraph (A) shall evaluate whether it is advisable to--
       (i) increase the asset threshold;
       (ii) index the asset threshold to a measure of inflation;
       (iii) increase the shareholder threshold;
       (iv) change the shareholder threshold to be based on the 
     number of beneficial owners; and
       (v) create new thresholds based on other criteria.
       (2) Report.--Not later than 2 years after the date of 
     enactment of this Act, the Chief Economist and the Director 
     of the Division of Corporation Finance of the Commission 
     shall jointly submit to the Committee on Banking, Housing, 
     and Urban Affairs of the Senate and the Committee on 
     Financial Services of the House of Representatives a report 
     that includes--
       (A) the findings of the study required under paragraph (1); 
     and
       (B) recommendations for statutory changes to improve the 
     shareholder registration thresholds.
       (c) Rulemaking.--Not later than one year after the date of 
     enactment of this Act, the Commission shall issue final 
     regulations to implement this section and the amendments made 
     by this section.
                                 ______
                                 
  SA 3834. Mr. CORKER (for himself, Mr. Gregg, Mr. Isakson, and Mr. 
LeMieux) submitted an amendment intended to be proposed to amendment SA 
3739 proposed by Mr. Reid (for Mr. Dodd (for himself and Mrs. Lincoln)) 
to the bill S. 3217, to promote the financial stability of the United 
States by improving accountability and transparency in the financial 
system, to end ``too big to fail'', to protect the American taxpayer by 
ending bailouts, to protect consumers from abusive financial services 
practices, and for other purposes; which was ordered to lie on the 
table; as follows:

       On page 1045, strike line 12 and all that follows through 
     ``SEC. 942.'' on page 1052, line 3, and insert the following:
       (b) Study on Risk Retention.--
       (1) Study.--
       (A) In general.--The Board of Governors, in coordination 
     and consultation with the Comptroller of the Currency, the 
     Corporation, the Federal Housing Finance Agency, and the 
     Commission, shall conduct a study of the asset-backed 
     securitization process.
       (B) Issues to be studied.--In conducting the study under 
     subparagraph (A), the Board of Governors shall evaluate--
       (i) the separate and combined impact of--

       (I) requiring loan originators or securitizers to retain an 
     economic interest in a portion of the credit risk for any 
     asset that the securitizer, through the issuance of an asset-
     backed security, transfers, sells, or conveys to a third 
     party; including--

       (aa) whether existing risk retention requirements such as 
     contractual representations and warranties, and statutory and 
     regulatory underwriting and consumer protection requirements 
     are sufficient to ensure the long-term accountability of 
     originators for loans they originate; and

[[Page S3263]]

       (bb) methodologies for establishing additional statutory 
     credit risk retention requirements;

       (II) the Financial Accounting Statements 166 and 167 issued 
     by the Financial Accounting Standards Board, as well as any 
     other statements issued before or after the date of enactment 
     of this section the Federal banking agencies determine to be 
     relevant;

       (ii) the impact of the factors described under subsection 
     (i) of this section on--

       (I) different classes of assets, such as residential 
     mortgages, commercial mortgages, commercial loans, auto 
     loans, and other classes of assets;
       (II) loan originators;
       (III) securitizers;
       (IV) access of consumers and businesses to credit on 
     reasonable terms.

       (2) Report.--Not later than 18 months after the date of 
     enactment of this section, the Board of Governors shall 
     submit to Congress a report on the study conducted under 
     paragraph (1). Such report shall include statutory and 
     regulatory recommendations for eliminating any negative 
     impacts on the continued viability of the asset-backed 
     securitization markets and on the availability of credit for 
     new lending identified by the study conducted under paragraph 
     (1).

     SEC. 942. RESIDENTIAL MORTGAGE UNDERWRITING STANDARDS.

       (a) Standards Established.--Notwithstanding any other 
     provision of this Act or any other provision of Federal, 
     State, or local law, the Federal banking agencies, in 
     consultation with the Federal Housing Finance Agency and the 
     Department of Housing and Urban Development, shall jointly 
     establish specific minimum standards for mortgage 
     underwriting, including--
       (1) a requirement that the mortgagee verify and document 
     the income and assets relied upon to qualify the mortgagor on 
     the residential mortgage, including the previous employment 
     and credit history of the mortgagor;
       (2) a down payment requirement that--
       (A) is equal to not less than 5 percent of the purchase 
     price of the property securing the residential mortgage; and
       (B) in the case of a first lien residential mortgage loan 
     with an initial loan to value ratio that is more than 80 
     percent and not more than 95 percent, includes a requirement 
     for credit enhancements, as defined by the Federal banking 
     agencies, until the loan to value ratio of the residential 
     mortgage loan amortizes to a value that is less than 80 
     percent of the purchase price;
       (3) a method for determining the ability of the mortgagor 
     to repay the residential mortgage that is based on factors 
     including--
       (A) all terms of the residential mortgage, including 
     principal payments that fully amortize the balance of the 
     residential mortgage over the term of the residential 
     mortgage; and
       (B) the debt to income ratio of the mortgagor; and
       (4) any other specific standards the Federal banking 
     agencies jointly determine are appropriate to ensure prudent 
     underwriting of residential mortgages.
       (b) Updates to Standards.--The Federal banking agencies, in 
     consultation with the Federal Housing Finance Agency and the 
     Department of Housing and Urban Development--
       (1) shall review the standards established under this 
     section not less frequently than every 5 years; and
       (2) based on the review under paragraph (1), may revise the 
     standards established under this section, as the Federal 
     banking agencies, in consultation with the Federal Housing 
     Finance Agency and the Department of Housing and Urban 
     Development, determine to be necessary.
       (c) Compliance.--It shall be a violation of Federal law--
       (1) for any mortgage loan originator to fail to comply with 
     the minimum standards for mortgage underwriting established 
     under subsection (a) in originating a residential mortgage 
     loan;
       (2) for any company to maintain an extension of credit on a 
     revolving basis to any person to fund a residential mortgage 
     loan, unless the company reasonably determines that the 
     residential mortgage loan funded by such credit was subject 
     to underwriting standards no less stringent than the minimum 
     standards for mortgage underwriting established under 
     subsection (a); or
       (3) for any company to purchase, fund by assignment, or 
     guarantee a residential mortgage loan, unless the company 
     reasonably determines that the residential mortgage loan was 
     subject to underwriting standards no less stringent than the 
     minimum standards for mortgage underwriting established under 
     subsection (a).
       (d) Implementation.--
       (1) Regulations required.--The Federal banking agencies, in 
     consultation with the Federal Housing Finance Agency, shall 
     issue regulations to implement subsections (a) and (c), which 
     shall take effect not later than 270 days after the date of 
     enactment of this Act.
       (2) Report required.--If the Federal banking agencies have 
     not issued final regulations under subsections (a) and (c) 
     before the date that is 270 days after the date of enactment 
     of this Act, the Federal banking agencies shall jointly 
     submit to the Committee on Banking, Housing, and Urban 
     Affairs of the Senate and the Committee on Financial Services 
     of the House of Representatives a report that--
       (A) explains why final regulations have not been issued 
     under subsections (a) and (c); and
       (B) provides a timeline for the issuance of final 
     regulations under subsections (a) and (c).
       (e) Enforcement.--Compliance with the rules issued under 
     this section shall be enforced by--
       (1) the primary financial regulatory agency of an entity, 
     with respect to an entity subject to the jurisdiction of a 
     primary financial regulatory agency, in accordance with the 
     statutes governing the jurisdiction of the primary financial 
     regulatory agency over the entity and as if the action of the 
     primary financial regulatory agency were taken under such 
     statutes; and
       (2) the Bureau, with respect to a company that is not 
     subject to the jurisdiction of a primary financial regulatory 
     agency.
       (f) Rule of Construction.--Nothing in this section may be 
     construed to permit the Federal National Mortgage Association 
     or the Federal Home Loan Mortgage Corporation to make or 
     guarantee a residential mortgage loan that does not meet the 
     minimum underwriting standards established under this 
     section.
       (g) Definitions.--In this section, the following 
     definitions shall apply:
       (1) Company.--The term ``company''--
       (A) has the same meaning as in section 2(b) of the Bank 
     Holding Company Act of 1956 (12 U.S.C. 1841(b)); and
       (B) includes a sole proprietorship.
       (2) Mortgage loan originator.--The term ``mortgage loan 
     originator'' means any company that takes residential 
     mortgage loan applications and offers or negotiates terms of 
     residential mortgage loans.
       (3) Residential mortgage loan.--The term ``residential 
     mortgage loan''--
       (A) means any extension of credit primarily for personal, 
     family, or household use that is secured by a mortgage, deed 
     of trust, or other equivalent security interest in a dwelling 
     or residential real estate upon which is constructed or 
     intended to be constructed a dwelling; and
       (B) does not include a mortgage loan for which mortgage 
     insurance is provided by the Veterans Administration, the 
     Federal Housing Administration, or the Rural Housing 
     Administration.
       (4) Extension of credit; dwelling.--The terms ``extension 
     of credit'' and ``dwelling'' shall have the same meaning as 
     in section 103 of the Truth in Lending Act (15 U.S.C. 1602).

     SEC. 943.

                                 ______
                                 
  SA 3835. Mr. CORKER submitted an amendment intended to be proposed to 
amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mrs. Lincoln)) to the bill S. 3217, to promote the financial stability 
of the United States by improving accountability and transparency in 
the financial system, to end ``too big to fail'', to protect the 
American taxpayer by ending bailouts, to protect consumers from abusive 
financial services practices, and for other purposes; which was ordered 
to lie on the table; as follows:

       On page 1290, between lines 4 and 5, insert the following:
       (s) No Authority Over Underwriting Standards for 
     Residential Mortgage Loans.--
       (1) Rule of construction.--Nothing in this title may be 
     construed as conferring authority on the Bureau to exercise 
     any rulemaking or other authority for matters pertaining to 
     underwriting standards with respect to residential mortgage 
     loans, except as otherwise authorized under section 1024.
       (2) Definitions.--For purposes of this subsection--
       (A) the term ``residential mortgage loan'' means any 
     extension of credit primarily for personal, family, or 
     household use that is secured by a mortgage, deed of trust, 
     or other equivalent security interest in a dwelling or 
     residential real estate upon which is constructed or intended 
     to be constructed a dwelling; and
       (B) the terms ``credit'' and ``dwelling'' have the same 
     meanings as in section 103 of the Truth in Lending Act (15 
     U.S.C. 1602).
                                 ______
                                 
  SA 3836. Mr. CORKER submitted an amendment intended to be proposed to 
amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mrs. Lincoln)) to the bill S. 3217, to promote the financial stability 
of the United States by improving accountability and transparency in 
the financial system, to end ``too big to fail'', to protect the 
American taxpayer by ending bailouts, to protect consumers from abusive 
financial services practices, and for other purposes; which was ordered 
to lie on the table; as follows:

       On page 61, after line 24, add the following:

     SEC. 122. COUNCIL REVIEW OF MEMBER AGENCY RULES.

       (a) In General.--The Council shall conduct a review of each 
     rule or regulation that a member agency intends to propose 
     relating to capital, liquidity, or leverage requirements for, 
     or restrictions on the activities of, an entity regulated by 
     the member agency. The Council shall consider international 
     regulatory rules in conducting a review under this 
     subsection.

[[Page S3264]]

       (b) Process.--
       (1) In general.--Each member agency shall submit to the 
     Council for a binding decision an advanced notice of proposed 
     rulemaking and any other proposed or final rule or regulation 
     that proposes changes to capital, liquidity, or leverage 
     requirements or activity restrictions for a financial company 
     that is subject to regulation by the member agency.
       (2) Standard for review.--In making a determination under 
     this subsection, the members of the Council shall consider 
     the safety and soundness of financial institutions and the 
     stability of the financial system of the United States.
       (c) Timing.--Not later than 60 days after the date on which 
     the Council receives a notice under subsection (b), the 
     Council shall make a determination of whether to approve the 
     issuance of the proposed rule or regulation that is the 
     subject of the notice.
       (d) Approval Required.--No rule or regulation described in 
     subsection (b) may become effective or enforceable, unless 
     approved by the Council under this section.
       (e) Public Notice.--The Council shall make public any 
     notice of proposed rulemaking or other notice of a rule or 
     regulation submitted by a member agency under this section.
                                 ______
                                 
  SA 3837. Mr. CORKER submitted an amendment intended to be proposed to 
amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mrs. Lincoln)) to the bill S. 3217, to promote the financial stability 
of the United States by improving accountability and transparency in 
the financial system, to end ``too big to fail'', to protect the 
American taxpayer by ending bailouts, to protect consumers from abusive 
financial services practices, and for other purposes; which was ordered 
to lie on the table; as follows:

       On page 1236, line 4 strike ``(3)'' and insert the 
     following:
       ``(3) FFIEC review of bureau regulations.--The Federal 
     Financial Institutions Examination Council shall review each 
     regulation prescribed by the Bureau prior to its effective 
     date, and unless approved by the Federal Financial 
     Institutions Examination Council, by majority vote, such 
     regulation shall not become effective.
       ``(4)''.
                                 ______
                                 
  SA 3838. Mr. BROWN of Massachusetts (for himself, Mrs. Shaheen, and 
Mr. Gregg) submitted an amendment intended to be proposed to amendment 
SA 3739 proposed by Mr. Reid (for Mr. Dodd (for himself and Mrs. 
Lincoln)) to the bill S. 3217, to promote the financial stability of 
the United States by improving accountability and transparency in the 
financial system, to end ``too big to fail'', to protect the American 
taxpayer by ending bailouts, to protect consumers from abusive 
financial services practices, and for other purposes; which was ordered 
to lie on the table; as follows:

       On page 295, between lines 19 and 20, insert the following:
       (s) Treatment of Certain Nonbank Financial Companies Not 
     Subject to Orderly Liquidation.--
       (1) In general.--Subsections (n) and (o) shall not apply to 
     any nonbank financial company that is subject to liquidation 
     or rehabilitation under State law, unless such company--
       (A) is determined to be a nonbank financial company 
     supervised by the Board of Governors pursuant to section 113; 
     or
       (B) is determined by the Corporation to have benefitted 
     financially from the orderly liquidation of a covered 
     financial company and the use of the Fund under this title by 
     receiving payments or credit pursuant to subsection (b)(4), 
     (d)(4), or (h)(5)(E).
       (2) Exclusion of assets.--Any assets of a nonbank financial 
     company described in paragraph (1) shall be excluded for 
     purposes of calculating a financial company's total 
     consolidated assets under subsection (o).
                                 ______
                                 
  SA 3839. Mr. McCAIN (for himself, Mr. Shelby, Mr. Gregg, Mr. Bennett, 
Mr. Crapo, and Mr. Corker) submitted an amendment intended to be 
proposed to amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for 
himself and Mrs. Lincoln)) to the bill S. 3217, to promote the 
financial stability of the United States by improving accountability 
and transparency in the financial system, to end ``too big fail'', to 
protect the American taxpayer by ending bailouts, to protect consumers 
from abusive financial services practices, and for other purposes; 
which was ordered to lie on the table; as follows:


 =========================== NOTE =========================== 

  
  On page S3264, May 5, 2010, in the second column, the following 
appears: SA 3839. Mr. McCAIN (for himself, Mrs. Shaheen, Mr. 
Gregg, Mr. Bennett, Mr. Crapo, and Mr. Corker) submitted an 
amendment intended to be proposed to amendment SA 3739 proposed by 
Mr. Reid (for Mr. Dodd (for himself and Mrs. Lincoln)) to the bill 
S. 3217,
  
  The online version has been corrected to read: SA 3839. Mr. 
McCAIN (for himself, Mr. Shelby, Mr. Gregg, Mr. Bennett, Mr. 
Crapo, and Mr. Corker) submitted an amendment intended to be 
proposed to amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd 
(for himself and Mrs. Lincoln)) to the bill S. 3217,


 ========================= END NOTE ========================= 


       At the end of the bill, add the following:

  TITLE XIII--ENHANCED REGULATION OF GOVERNMENT-SPONSORED ENTERPRISES

      Subtitle A--GSE Bailout Elimination and Taxpayer Protection

     SECTION 1311. SHORT TITLE.

       This subtitle may be cited as the ``GSE Bailout Elimination 
     and Taxpayer Protection Act''.

     SEC. 1312. DEFINITIONS.

       For purposes of this subtitle, the following definitions 
     shall apply:
       (1) Charter.--The term ``charter'' means--
       (A) with respect to the Federal National Mortgage 
     Association, the Federal National Mortgage Association 
     Charter Act (12 U.S.C. 1716 et seq.); and
       (B) with respect to the Federal Home Loan Mortgage 
     Corporation, the Federal Home Loan Mortgage Corporation Act 
     (12 U.S.C. 1451 et seq.).
       (2) Director.--The term ``Director'' means the Director of 
     the Federal Housing Finance Agency.
       (3) Enterprise.--The term ``enterprise'' means--
       (A) the Federal National Mortgage Association; and
       (B) the Federal Home Loan Mortgage Corporation.
       (4) Guarantee.--The term ``guarantee'' means, with respect 
     to an enterprise, the credit support of the enterprise that 
     is provided by the Federal Government through its charter as 
     a government-sponsored enterprise.

     SEC. 1313. TERMINATION OF CURRENT CONSERVATORSHIP.

       (a) In General.--Upon the expiration of the period referred 
     to in subsection (b), the Director of the Federal Housing 
     Finance Agency shall determine, with respect to each 
     enterprise, if the enterprise is financially viable at that 
     time and--
       (1) if the Director determines that the enterprise is 
     financially viable, immediately take all actions necessary to 
     terminate the conservatorship for the enterprise that is in 
     effect pursuant to section 1367 of the Federal Housing 
     Enterprises Financial Safety and Soundness Act of 1992 (12 
     U.S.C. 4617); or
       (2) if the Director determines that the enterprise is not 
     financially viable, immediately appoint the Federal Housing 
     Finance Agency as receiver under section 1367 of the Federal 
     Housing Enterprises Financial Safety and Soundness Act of 
     1992 and carry out such receivership under the authority of 
     such section.
       (b) Timing.--The period referred to in this subsection is, 
     with respect to an enterprise--
       (1) except as provided in paragraph (2), the 24-month 
     beginning upon the date of the enactment of this Act; or
       (2) if the Director determines before the expiration of the 
     period referred to in paragraph (1) that the financial 
     markets would be adversely affected without the extension of 
     such period under this paragraph with respect to that 
     enterprise, and upon making such determination notifies the 
     Congress in writing of such determination, the 30-month 
     period beginning upon the date of the enactment of this Act.
       (c) Financial Viability.--The Director may not determine 
     that an enterprise is financially viable for purposes of 
     subsection (a) if the Director determines that any of the 
     conditions for receivership set forth in paragraph (3) or (4) 
     of section 1367(a) of the Federal Housing Enterprises 
     Financial Safety and Soundness Act of 1992 (12 U.S.C. 
     4617(a)) exists at the time with respect to the enterprise.

     SEC. 1314. LIMITATION OF ENTERPRISE AUTHORITY UPON EMERGENCE 
                   FROM CONSERVATORSHIP.

       (a) Revised Authority.--Upon the expiration of the period 
     referred to in section 1113(b), if the Director makes the 
     determination under section 1113(a)(1), the following 
     provisions shall take effect:
       (1) Repeal of housing goals.--
       (A) Repeal.--The Federal Housing Enterprises Financial 
     Safety and Soundness Act of 1992 is amended by striking 
     sections 1331 through 1336 (12 U.S.C. 4561-6).
       (B) Conforming amendments.--Federal Housing Enterprises 
     Financial Safety and Soundness Act of 1992 is amended--
       (i) in section 1303(28) (12 U.S.C. 4502(28)), by striking 
     ``and, for the purposes'' and all that follows through 
     ``designated disaster areas'';
       (ii) in section 1324(b)(1)(A) (12 U.S.C. 4544(b)(1)(A))--

       (I) by striking clauses (i), (ii), and (iv);
       (II) in clause (iii), by inserting ``and'' after the 
     semicolon at the end; and
       (III) by redesignating clauses (iii) and (v) as clauses (i) 
     and (ii), respectively;

       (iii) in section 1338(c)(10) (12 U.S.C. 4568(c)(10)), by 
     striking subparagraph (E);
       (iv) in section 1339(h) (12 U.S.C. 4569), by striking 
     paragraph (7);
       (v) in section 1341 (12 U.S.C. 4581)--

       (I) in subsection (a)--

       (aa) in paragraph (1), by inserting ``or'' after the 
     semicolon at the end;
       (bb) in paragraph (2), by striking the semicolon at the end 
     and inserting a period; and
       (cc) by striking paragraphs (3) and (4); and

       (II) in subsection (b)(2)--

       (aa) in subparagraph (A), by inserting ``or'' after the 
     semicolon at the end;
       (bb) by striking subparagraphs (B) and (C); and
       (cc) by redesignating subparagraph (D) as subparagraph (B);
       (vi) in section 1345(a) (12 U.S.C. 4585(a))--

       (I) in paragraph (1), by inserting ``or'' after the 
     semicolon at the end;
       (II) in paragraph (2), by striking the semicolon at the end 
     and inserting a period; and
       (III) by striking paragraphs (3) and (4); and

       (vii) in section 1371(a)(2) (12 U.S.C. 4631(a)(2))--

       (I) by striking ``with any housing goal established under 
     subpart B of part 2 of subtitle A of this title,''; and
       (II) by striking ``section 1336 or''.

[[Page S3265]]

       (2) Portfolio limitations.--Subtitle B of title XIII of the 
     Housing and Community Development Act of 1992 (12 U.S.C. 4611 
     et seq.) is amended by adding at the end the following new 
     section:

     ``SEC. 1369E. RESTRICTION ON MORTGAGE ASSETS OF ENTERPRISES.

       ``(a) Restriction.--No enterprise shall own, as of any 
     applicable date in this subsection or thereafter, mortgage 
     assets in excess of--
       ``(1) upon the expiration of the period referred to in 
     section 1113(b) of the GSE Bailout Elimination and Taxpayer 
     Protection Act or thereafter, 95 percent of the aggregate 
     amount of mortgage assets that the regulated entity owned on 
     December 31 of the previous year, provided, that in no event 
     shall the regulated entity be required under this paragraph 
     to own less than $250,000,000,000 in mortgage assets;
       ``(2) upon the expiration of the 1-year period that begins 
     on the date described in paragraph (1) or thereafter, 75 
     percent of the aggregate amount of mortgage assets that the 
     regulated entity owned in section 1113(b) of the GSE Bailout 
     Elimination and Taxpayer Protection Act, provided, that in no 
     event shall the regulated entity be required under this 
     paragraph to own less than $250,000,000,000 in mortgage 
     assets;
       ``(3) upon the expiration of the 2-year period that begins 
     on the date described in paragraph (1) or thereafter, 75 
     percent of the aggregate amount of mortgage assets that the 
     regulated entity owned upon the expiration of the 1-year 
     period that begins on the date described in paragraph (1), 
     provided, that in no event shall the regulated entity be 
     required under this paragraph to own less than 
     $250,000,000,000 in mortgage assets; and
       ``(4) upon the expiration of the 3-year period that begins 
     on the date described in paragraph (1), $250,000,000,000.
       ``(b) Definition of Mortgage Assets.--For purposes of this 
     section, the term `mortgage assets' means, with respect to an 
     enterprise, assets of such enterprise consisting of 
     mortgages, mortgage loans, mortgage-related securities, 
     participation certificates, mortgage-backed commercial paper, 
     obligations of real estate mortgage investment conduits and 
     similar assets, in each case to the extent such assets would 
     appear on the balance sheet of such enterprise in accordance 
     with generally accepted accounting principles in effect in 
     the United States as of September 7, 2008 (as set forth in 
     the opinions and pronouncements of the Accounting Principles 
     Board and the American Institute of Certified Public 
     Accountants and statements and pronouncements of the 
     Financial Accounting Standards Board from time to time; and 
     without giving any effect to any change that may be made 
     after September 7, 2008, in respect of Statement of Financial 
     Accounting Standards No. 140 or any similar accounting 
     standard).''.
       (3) Increase in minimum capital requirement.--Section 1362 
     of the Federal Housing Enterprises Financial Safety and 
     Soundness Act of 1992 (12 U.S.C. 4612), as amended by section 
     1111 of the Housing and Economic Recovery Act of 2008 (Public 
     Law 110-289), is amended--
       (A) in subsection (a), by striking ``For purposes of this 
     subtitle, the minimum capital level for each enterprise shall 
     be'' and inserting ``The minimum capital level established 
     under subsection (g) for each enterprise may not be lower 
     than'';
       (B) in subsection (c)--
       (i) by striking ``subsections (a) and'' and inserting 
     ``subsection'';
       (ii) by striking ``regulated entities'' the first place 
     such term appears and inserting ``Federal Home Loan Banks'';
       (iii) by striking ``for the enterprises,'';
       (iv) by striking ``, or for both the enterprises and the 
     banks,'';
       (v) by striking ``the level specified in subsection (a) for 
     the enterprises or''; and
       (vi) by striking ``the regulated entities operate'' and 
     inserting ``such banks operate'';
       (C) in subsection (d)(1)--
       (i) by striking ``subsections (a) and'' and inserting 
     ``subsection''; and
       (ii) by striking ``regulated entity'' each place such term 
     appears and inserting ``Federal home loan bank'';
       (D) in subsection (e), by striking ``regulated entity'' 
     each place such term appears and inserting ``Federal home 
     loan bank'';
       (E) in subsection (f)--
       (i) by striking ``the amount of core capital maintained by 
     the enterprises,''; and
       (ii) by striking ``regulated entities'' and inserting 
     ``banks''; and
       (F) by adding at the end the following new subsection:
       ``(g) Establishment of Revised Minimum Capital Levels.--
       ``(1) In general.--The Director shall cause the enterprises 
     to achieve and maintain adequate capital by establishing 
     minimum levels of capital for such the enterprises and by 
     using such other methods as the Director deems appropriate.
       ``(2) Authority.--The Director shall have the authority to 
     establish such minimum level of capital for an enterprise in 
     excess of the level specified under subsection (a) as the 
     Director, in the Director's discretion, deems to be necessary 
     or appropriate in light of the particular circumstances of 
     the enterprise.
       ``(h) Failure To Maintain Revised Minimum Capital Levels.--
       ``(1) Unsafe and unsound practice or condition.--Failure of 
     a enterprise to maintain capital at or above its minimum 
     level as established pursuant to subsection (g) of this 
     section may be deemed by the Director, in his discretion, to 
     constitute an unsafe and unsound practice or condition within 
     the meaning of this title.
       ``(2) Directive to achieve capital level.--
       ``(A) Authority.--In addition to, or in lieu of, any other 
     action authorized by law, including paragraph (1), the 
     Director may issue a directive to an enterprise that fails to 
     maintain capital at or above its required level as 
     established pursuant to subsection (g) of this section.
       ``(B) Plan.--Such directive may require the enterprise to 
     submit and adhere to a plan acceptable to the Director 
     describing the means and timing by which the enterprise shall 
     achieve its required capital level.
       ``(C) Enforcement.--Any such directive issued pursuant to 
     this paragraph, including plans submitted pursuant thereto, 
     shall be enforceable under the provisions of subtitle C of 
     this title to the same extent as an effective and outstanding 
     order issued pursuant to subtitle C of this title which has 
     become final.
       ``(3) Adherence to plan.--
       ``(A) Consideration.--The Director may consider such 
     enterprise's progress in adhering to any plan required under 
     this subsection whenever such enterprise seeks the requisite 
     approval of the Director for any proposal which would divert 
     earnings, diminish capital, or otherwise impede such 
     enterprise's progress in achieving its minimum capital level.
       ``(B) Denial.--The Director may deny such approval where it 
     determines that such proposal would adversely affect the 
     ability of the enterprise to comply with such plan.''.
       (4) Repeal of increases to conforming loan limits.--
       (A) Repeal of temporary increases.--
       (i) Continuing appropriations resolution, 2010.--Section 
     167 of the Continuing Appropriations Resolution, 2010 (as 
     added by section 104 of division B of Public Law 111-88; 123 
     Stat. 2973) is hereby repealed.
       (ii) American recovery and reinvestment act of 2009.--
     Section 1203 of division A of the American Recovery and 
     Reinvestment Act of 2009 (Public Law 111-5; 123 Stat. 225) is 
     hereby repealed.
       (iii) Economic stimulus act of 2008.--Section 201 of the 
     Economic Stimulus Act of 2008 (Public Law 110-185; 122 Stat. 
     619) is hereby repealed.
       (B) Repeal of general limit and permanent high-cost area 
     increase.--Paragraph (2) of section 302(b) of the Federal 
     National Mortgage Association Charter Act (12 U.S.C. 
     1717(b)(2)) and paragraph (2) of section 305(a) of the 
     Federal Home Loan Mortgage Corporation Act (12 U.S.C. 
     1454(a)(2)) are each amended to read as such sections were in 
     effect immediately before the enactment of the Housing and 
     Economic Recovery Act of 2008 (Public Law 110-289).
       (C) Repeal of new housing price index.--Section 1322 of the 
     Federal Housing Enterprises Financial Safety and Soundness 
     Act of 1992, as added by section 1124(d) of the Housing and 
     Economic Recovery Act of 2008 (Public Law 110-289), is hereby 
     repealed.
       (D) Repeal.--Section 1124 of the Housing and Economic 
     Recovery Act of 2008 (Public Law 110-289) is hereby repealed.
       (E) Establishment of conforming loan limit.--For the year 
     in which the expiration of the period referred to in section 
     1113(b) occurs, the limitations governing the maximum 
     original principal obligation of conventional mortgages that 
     may be purchased by the Federal National Mortgage Association 
     and the Federal Home Loan Mortgage Corporation, referred to 
     in section 302(b)(2) of the Federal National Mortgage 
     Association Charter Act (12 U.S.C. 1717(b)(2)) and section 
     305(a)(2) of the Federal Home Loan Mortgage Corporation Act 
     (12 U.S.C. 1454(a)(2)), respectively, shall be considered to 
     be--
       (i) $417,000 for a mortgage secured by a single-family 
     residence,
       (ii) $533,850 for a mortgage secured by a 2-family 
     residence,
       (iii) $645,300 for a mortgage secured by a 3-family 
     residence, and
       (iv) $801,950 for a mortgage secured by a 4-family 
     residence,
     and such limits shall be adjusted effective each January 1 
     thereafter in accordance with such sections 302(b)(2) and 
     305(a)(2).
       (F) Prohibition of purchase of mortgages exceeding median 
     area home price.--
       (i) Fannie mae.--Section 302(b)(2) of the Federal National 
     Mortgage Association Charter Act (12 U.S.C. 1717(b)(2)) is 
     amended by adding at the end the following new sentence: 
     ``Notwithstanding any other provision of this title, the 
     corporation may not purchase any mortgage asset for a 
     property having a principal obligation that exceeds the 
     median home price, for properties of the same size, for the 
     area in which such property subject to the mortgage is 
     located.''.
       (ii) Freddie mac.--Section 305(a)(2) of the Federal Home 
     Loan Mortgage Corporation Act (12 U.S.C. 1454(a)(2)) is 
     amended by adding at the end the following new sentence: 
     ``Notwithstanding any other provision of this title, the 
     Corporation may not purchase any mortgage for a property 
     having a principal obligation that exceeds the median home 
     price, for properties of the same size, for the area in which 
     such property subject to the mortgage is located.''.
       (5) Requirement of minimum down payment for mortgages 
     purchased.--

[[Page S3266]]

       (A) Fannie mae.--Subsection (b) of section 302 of the 
     Federal National Mortgage Association Charter Act (12 U.S.C. 
     1717(b)) is amended by adding at the end the following new 
     paragraph:
       ``(7) Notwithstanding any other provision of this Act, the 
     corporation may not newly purchase any mortgage asset, unless 
     the mortgagor has paid, in cash or its equivalent on account 
     of the property securing repayment such mortgage, in 
     accordance with regulations issued by the Director of the 
     Federal Housing Finance Agency, not less than--
       ``(A) for any mortgage purchased during the 12-month period 
     beginning upon the expiration of the period referred to in 
     section 1113(b) of the GSE Bailout Elimination and Taxpayer 
     Protection Act, 5 percent of the appraised value of the 
     property;
       ``(B) for any mortgage purchased during the 12-month period 
     beginning upon the expiration of the 12-month period referred 
     to in subparagraph (A) of this paragraph, 7.5 percent of the 
     appraised value of the property; and
       ``(C) for any mortgage purchased during the 12-month period 
     beginning upon the expiration of the 12-month period referred 
     to in subparagraph (B) of this paragraph, 10 percent of the 
     appraised value of the property.''.
       (B) Freddie mac.--Subsection (a) of section 305 of the 
     Federal Home Loan Mortgage Corporation Act (12 U.S.C. 
     1454(a)) is amended by adding at the end the following new 
     paragraph:
       ``(6) Notwithstanding any other provision of this Act, the 
     Corporation may not newly purchase any mortgage asset, unless 
     the mortgagor has paid, in cash or its equivalent on account 
     of the property securing repayment such mortgage, in 
     accordance with regulations issued by the Director of the 
     Federal Housing Finance Agency, not less than--
       ``(A) for any mortgage purchased during the 12-month period 
     beginning upon the expiration of the period referred to in 
     section 1113(b) of the GSE Bailout Elimination and Taxpayer 
     Protection Act, 5 percent of the appraised value of the 
     property;
       ``(B) for any mortgage purchased during the 12-month period 
     beginning upon the expiration of the 12-month period referred 
     to in subparagraph (A) of this paragraph, 7.5 percent of the 
     appraised value of the property; and
       ``(C) for any mortgage purchased during the 12-month period 
     beginning upon the expiration of the 12-month period referred 
     to in subparagraph (B) of this paragraph, 10 percent of the 
     appraised value of the property.''.
       (6) Minimum prudent underwriting standards.--The Federal 
     Housing Finance Agency shall, not later than 6 months after 
     the date of enactment of this Act, issue regulations 
     specifying minimum prudent underwriting standards for 
     residential mortgage loans eligible for purchase by an 
     enterprise, which regulations shall include minimum 
     requirements for--
       (A) verification and documentation of income and assets 
     relied upon to qualify the obligor on the loan;
       (B) determination of the ability of the obligor to repay, 
     based on all terms of the loan, including principal payments 
     that fully amortize the balance over the term of the loan; 
     and
       (C) any other standards that the Federal Housing Finance 
     Agency determines appropriate to ensure prudent underwriting 
     and which effect the safety and soundness of the regulated 
     entities.
       (7) Requirement to pay state and local taxes.--
       (A) Fannie mae.--Paragraph (2) of section 309(c) of the 
     Federal National Mortgage Association Charter Act (12 U.S.C. 
     1723a(c)(2)) is amended--
       (i) by striking ``shall be exempt from'' and inserting 
     ``shall be subject to''; and
       (ii) by striking ``except that any'' and inserting ``and 
     any''.
       (B) Freddie mac.--Section 303(e) of the Federal Home Loan 
     Mortgage Corporation Act (12 U.S.C. 1452(e)) is amended--
       (i) by striking ``shall be exempt from'' and inserting 
     ``shall be subject to''; and
       (ii) by striking ``except that any'' and inserting ``and 
     any''.
       (8) Repeals relating to registration of securities.--
       (A) Fannie mae.--
       (i) Mortgage-backed securities.--Section 304(d) of the 
     Federal National Mortgage Association Charter Act (12 U.S.C. 
     1719(d)) is amended by striking the fourth sentence.
       (ii) Subordinate obligations.--Section 304(e) of the 
     Federal National Mortgage Association Charter Act (12 U.S.C. 
     1719(e)) is amended by striking the fourth sentence.
       (B) Freddie mac.--Section 306 of the Federal Home Loan 
     Mortgage Corporation Act (12 U.S.C. 1455) is amended by 
     striking subsection (g).
       (9) Recoupment of costs for federal guarantee.--
       (A) Assessments.--The Director of the Federal Housing 
     Finance Agency shall establish and collect from each 
     enterprise assessments in the amount determined under 
     subparagraph (B). In determining the method and timing for 
     making such assessments, the Director shall take into 
     consideration the determinations and conclusions of the study 
     under subsection (b) of this section.
       (B) Determination of costs of guarantee.--Assessments under 
     subparagraph (A) with respect to an enterprise shall be in 
     such amount as the Director determines necessary to recoup to 
     the Federal Government the full value of the benefit the 
     enterprise receives from the guarantee provided by the 
     Federal Government for the obligations and financial 
     viability of the enterprise, based upon the dollar value of 
     such benefit in the market to such enterprise when not 
     operating under conservatorship or receivership. To determine 
     such amount, the Director shall establish a risk-based 
     pricing mechanism as the Director considers appropriate, 
     taking into consideration the determinations and conclusions 
     of the study under subsection (b).
       (C) Treatment of recouped amounts.--The Director shall 
     cover into the general fund of the Treasury any amounts 
     received from assessments made under this paragraph.
       (b) GAO Study Regarding Recoupment of Costs for Federal 
     Government Guarantee.--The Comptroller General of the United 
     States shall conduct a study to determine a risk-based 
     pricing mechanism to accurately determine the value of the 
     benefit the enterprises receive from the guarantee provided 
     by the Federal Government for the obligations and financial 
     viability of the enterprises. Such study shall establish a 
     dollar value of such benefit in the market to each enterprise 
     when not operating under conservatorship or receivership, 
     shall analyze various methods of the Federal Government 
     assessing a charge for such value received (including methods 
     involving an annual fee or a fee for each mortgage purchased 
     or securitized), and shall make a recommendation of the best 
     such method for assessing such charge. Not later than 12 
     months after the date of enactment of this Act, the 
     Comptroller General shall submit to the Congress a report 
     setting forth the determinations and conclusions of such 
     study.

     SEC. 1315. REQUIRED WIND DOWN OF OPERATIONS AND DISSOLUTION 
                   OF ENTERPRISE.

       (a) Applicability.--This section shall apply to an 
     enterprise upon the expiration of the 3-year period referred 
     to in section 1113(b).
       (b) Repeal of Charter.--Upon the applicability of this 
     section to an enterprise, the charter for the enterprise is 
     repealed and the enterprise shall have no authority to 
     conduct new business under such charter, except that the 
     provisions of such charter in effect immediately before such 
     repeal shall continue to apply with respect to the rights and 
     obligations of any holders of outstanding debt obligations 
     and mortgage-backed securities of the enterprise.
       (c) Wind Down.--Upon the applicability of this section to 
     an enterprise, the Director and the Secretary of the Treasury 
     shall jointly take such action, and may prescribe such 
     regulations and procedures, as may be necessary to wind down 
     the operations of an enterprise as an entity chartered by the 
     United States Government over the duration of the 10-year 
     period beginning upon the applicability of this section to 
     the enterprise (pursuant to subsection (a)) in an orderly 
     manner consistent with this subtitle and the ongoing 
     obligations of the enterprise.
       (d) Division of Assets and Liabilities; Authority To 
     Establish Holding Corporation and Dissolution Trust Fund.--
     The action and procedures required under subsection (c)--
       (1) shall include the establishment and execution of plans 
     to provide for an equitable division and distribution of 
     assets and liabilities of the enterprise, including any 
     liability of the enterprise to the United States Government 
     or a Federal reserve bank that may continue after the end of 
     the period described in subsection (a); and
       (2) may provide for establishment of--
       (A) a holding corporation organized under the laws of any 
     State of the United States or the District of Columbia for 
     the purposes of the reorganization and restructuring of the 
     enterprise; and
       (B) one or more trusts to which to transfer--
       (i) remaining debt obligations of the enterprise, for the 
     benefit of holders of such remaining obligations; or
       (ii) remaining mortgages held for the purpose of backing 
     mortgage-backed securities, for the benefit of holders of 
     such remaining securities.

Subtitle B--Inspector General for Regulated Entities in Conservatorship

     SEC. 1321. SPECIAL INSPECTOR GENERAL FOR THE CONSERVATORSHIP 
                   OF REGULATED ENTITIES.

       (a) Office of Inspector General.--There is established in 
     the General Accountability Office the Office of the Special 
     Inspector General for the Conservatorship of Regulated 
     Entities.
       (b) Appointment of Inspector General.--
       (1) Leadership.--The head of the Office established under 
     subsection (a) shall be the Special Inspector General for the 
     Conservatorship of Regulated Entities (in this section 
     referred to as the ``Special Inspector General''), who shall 
     be appointed by the President, by and with the advice and 
     consent of the Senate.
       (2) Appointment.--The appointment of the Special Inspector 
     General shall be made on the basis of integrity and 
     demonstrated ability in accounting, auditing, financial 
     analysis, law, management analysis, public administration, or 
     investigations.
       (3) Timing.--The nomination of an individual as Special 
     Inspector General shall be made as soon as is practicable 
     following the date of enactment of this Act, but not later 
     than 30 days after that date of enactment.

[[Page S3267]]

       (4) Removable for cause.--The Special Inspector General 
     shall be removable from office, in accordance with the 
     provisions of section 3(b) of the Inspector General Act of 
     1978 (5 U.S.C. App.).
       (5) Status.--For purposes of section 7324 of title 5, 
     United States Code, the Special Inspector General shall not 
     be considered an employee who determines policies to be 
     pursued by the United States in the nationwide administration 
     of Federal law.
       (6) Compensation.--The annual rate of basic pay of the 
     Special Inspector General shall be the annual rate of basic 
     pay for an Inspector General under section 3(e) of the 
     Inspector General Act of 1978 (5 U.S.C. App.).
       (c) Duties.--
       (1) In general.--It shall be the duty of the Special 
     Inspector General to conduct, supervise, and coordinate 
     audits and investigations of the purchase, management, and 
     sale of assets by regulated entities, so long as the entities 
     remain in conservatorship under section 1367 of the Federal 
     Housing Enterprises Financial Safety and Soundness Act of 
     1992 (12 U.S.C. 4617) (in this section referred to as 
     ``regulated entities''), including by collecting and 
     summarizing--
       (A) a description of the categories of mortgage assets 
     purchased or otherwise procured by regulated entities;
       (B) an explanation of the reasons why the Director of the 
     Federal Housing Finance Agency (in this section referred to 
     as the ``Director'') deemed it necessary to purchase each 
     such mortgage asset;
       (C) a listing of each institution from which such mortgage 
     assets were purchased;
       (D) a current estimate of the total amount of mortgage 
     assets purchased since the date of appointment of the Federal 
     Housing Finance Agency (in this section referred to as the 
     ``Agency'') as conservator and the profit and loss, projected 
     or realized, of each such mortgage asset;
       (E) a description of the categories of mortgage loans 
     modified by regulated entities;
       (F) an explanation of the reasons why the Director deemed 
     it necessary to modify each such mortgage loan;
       (G) an explanation of the risk analysis procedures in place 
     within regulated entities and the Council in respect to the 
     modification process, as well as the loans accepted into the 
     modification process;
       (H) an explanation of the effect of continuing the 
     affordable housing goals of the regulated entities on the 
     financial standing of the regulated entities;
       (I) the impact on any funding requested and accepted as a 
     part of the Amended and Restated Senior Preferred Stock 
     Purchase Agreement, dated September 26, 2008, amended May 6, 
     2009, amended December 24, 2009, and amended further at any 
     point following the date of enactment of this Act;
       (J) an assessment of whether the budgetary treatment of the 
     assets and liabilities of the entities is correct, as it 
     relates to the budget proposed by the President, as required 
     under section 1105(a) of title 31, United States Code;
       (K) an explanation of troubled assets owned by the 
     regulated entities and acquired prior to the conservatorship; 
     and
       (L) a description of any changes to the structure of the 
     regulated entities made by the Director and an explanation of 
     how the changes will better enable the regulated entities to 
     be successful during and post conservatorship.
       (2) Administrative authority.--The Special Inspector 
     General shall establish, maintain, and oversee such systems, 
     procedures, and controls as the Special Inspector General 
     considers appropriate to discharge the duty under paragraph 
     (1).
       (3) Other duties.--In addition to the duties specified in 
     paragraphs (1) and (2), the Inspector General shall have the 
     duties and responsibilities of inspectors general under the 
     Inspector General Act of 1978, including sections 4(b)(1) and 
     6 of that Act.
       (d) Personnel, Facilities, and Other Resources.--
       (1) Authority for officers and employees.--The Special 
     Inspector General may select, appoint, and employ such 
     officers and employees as may be necessary for carrying out 
     the duties of the Special Inspector General, subject to the 
     provisions of title 5, United States Code, governing 
     appointments in the competitive service, and the provisions 
     of chapter 51 and subchapter III of chapter 53 of such title, 
     relating to classification and General Schedule pay rates.
       (2) Services.--The Special Inspector General may obtain 
     services, as authorized by section 3109 of title 5, United 
     States Code, at daily rates not to exceed the equivalent rate 
     prescribed for grade GS-15 of the General Schedule by section 
     5332 of such title.
       (3) Contracts.--The Special Inspector General may enter 
     into contracts and other arrangements for audits, studies, 
     analyses, and other services with public agencies and with 
     private persons, and make such payments as may be necessary 
     to carry out the duties of the Inspector General.
       (4) Agency cooperation.--
       (A) Requests.--Upon request of the Special Inspector 
     General for information or assistance from any department, 
     agency, or other entity of the Federal Government, the head 
     of such entity shall, in so far as is practicable and not in 
     contravention of any other provision of law, furnish such 
     information or assistance to the Special Inspector General, 
     or an authorized designee thereof.
       (B) Reports of unreasonable denials.--Whenever information 
     or assistance requested by the Special Inspector General is, 
     in the judgment of the Special Inspector General, 
     unreasonably refused or not provided, the Special Inspector 
     General shall report the circumstances to the appropriate 
     committees of Congress, without delay.
       (e) Reports.--
       (1) Quarterly reports to congress.--Not later than 60 days 
     after the confirmation of the Special Inspector General, and 
     every calendar quarter thereafter, the Special Inspector 
     General shall submit to the appropriate committees of 
     Congress a report summarizing the activities of the Special 
     Inspector General during the 120-day period ending on the 
     date of such report. Each report shall include, for the 
     period covered by such report, a detailed statement of all 
     information collected under subsection (c)(1).
       (2) Rule of construction.--Nothing in this subsection shall 
     be construed to authorize the public disclosure of 
     information that is--
       (A) specifically prohibited from disclosure by any other 
     provision of law;
       (B) specifically required by Executive Order to be 
     protected from disclosure in the interest of national defense 
     or national security or in the conduct of foreign affairs; or
       (C) a part of an ongoing criminal investigation.
       (f) Funding.--Of the amounts made available to the 
     Secretary, under section 118 of the Emergency Economic 
     Stabilization Act of 2008 (12 U.S.C. 5228), $5,000,000 shall 
     be available to the Special Inspector General to carry out 
     this section, which amount shall remain available until 
     expended.
       (g) Termination.--
       (1) In general.--The Office of the Special Inspector 
     General shall terminate 90 days after the date of the 
     emergence of all regulated entities from conservatorship and 
     receivership under section 1367 of the Federal Housing 
     Enterprises Financial Safety and Soundness Act of 1992 (12 
     U.S.C. 4617).
       (2) Final report.--The Office of the Special Inspector 
     General shall prepare and submit a final report to Congress 
     not later than the end of the 90-day period referred to in 
     paragraph (1).

  Subtitle C--Limiting Further Bailouts of Fannie Mae and Freddie Mac

     SEC. 1331. SHORT TITLE.

       This subtitle may be cited as the ``Ending Bailouts of 
     Fannie Mae and Freddie Mac Act''.

     SEC. 1332. REESTABLISHING THE MAXIMUM AGGREGATE AMOUNT 
                   PERMITTED TO BE PROVIDED BY THE TAXPAYERS TO 
                   FANNIE MAE AND FREDDIE MAC.

       Section 1367(b)(2) of the Federal Housing Enterprises 
     Financial Safety and Soundness Act of 1992 (12 U.S.C. 
     4617(b)(2)) is amended by adding at the end the following new 
     subparagraph:
       ``(L) Reestablishment of taxpayer funding caps.--The 
     Agency, as conservator, shall prevent a regulated entity from 
     requesting or receiving any funds from the United States 
     Department of the Treasury, as part of the Amended and 
     Restated Senior Preferred Stock Purchase Agreement, dated as 
     of September 26, 2008, amended May 6, 2009, and further 
     amended December 24, 2009, between the United State 
     Department of the Treasury and the Federal Home Loan Mortgage 
     Corporation, or the Federal National Mortgage Association, 
     that exceeds a maximum aggregate amount of 
     $200,000,000,000.''.

     SEC. 1333. REESTABLISHING SCHEDULED REDUCTION OF MORTGAGE 
                   ASSETS OWNED BY FANNIE MAE AND FREDDIE MAC.

       Section 1367(b)(2) of the Federal Housing Enterprises 
     Financial Safety and Soundness Act of 1992 (12 U.S.C. 
     4617(b)(2)) is amended by adding at the end the following new 
     subparagraph:
       ``(M) Reduction of owned mortgage assets.--
       ``(i) In general.--The Agency, as conservator, shall ensure 
     that a regulated entity does not own, as of any applicable 
     date, mortgage assets in excess of 90.0 percent of the 
     aggregate amount of mortgage assets that the regulated entity 
     owned on December 31 of each of the previous year, provided, 
     that in no event shall the regulated entity be required under 
     this subparagraph to own less than $250,000,000,000 in 
     mortgage assets.
       ``(ii) Definition of mortgage assets.--For purposes of this 
     subparagraph, the term `mortgage assets' means with respect 
     to a regulated entity, assets of such entity consisting of 
     mortgages, mortgage loans, mortgage-related securities, 
     participation certificates, mortgage-backed commercial paper, 
     obligations of real estate mortgage investment conduits and 
     similar assets, in each case to the extent such assets would 
     appear on the balance sheet of such entity in accordance with 
     generally accepted accounting principles.''.

     SEC. 1334. ENSURING CONGRESSIONAL REVIEW FOR AGREEMENTS 
                   INCREASING TAXPAYER RISK.

       Section 1367(b)(2) of the Federal Housing Enterprises 
     Financial Safety and Soundness Act of 1992 (12 U.S.C. 
     4617(b)(2)), as amended by sections 1203 and 1204, is further 
     amended by adding at the end the following new subparagraph:
       ``(N) Agreements.--
       ``(i) In general.--The Agency, as conservator or receiver, 
     may enter into agreements that are consistent with its 
     appointment as conservator or receiver with the regulated 
     entity and that expire prior to, or upon, the regulated 
     entity's emergence from conservatorship or receivership 
     provided--

[[Page S3268]]

       ``(I) the agreement does not expose the United States 
     taxpayers to additional risk; and
       ``(II) the agreement was approved by Congress pursuant to 
     clause (ii).

       ``(ii) Procedure for congressional approval.--

       ``(I) In general.--Notwithstanding clause (i), the Agency 
     may enter into, on an interim basis, an agreement, even if 
     the agreement exposes the taxpayer to additional risk, 
     including if such agreement exceeds the limitations 
     established under subparagraphs (L) and (M), if such an 
     agreement--

       ``(aa) is deemed necessary by the Agency, based upon the 
     Agency's duties as conservator or receiver; and
       ``(bb) is approved by Congress through adoption of a 
     concurrent resolution of approval, not more than 120 days 
     after the later of--
       ``(AA) the signing of the agreement; or
       ``(BB) the date of enactment of the Ending Bailouts of 
     Fannie Mae and Freddie Mac Act.

       ``(II) Required submissions for congressional review.--
     During the 120-day period described under subclause (I), the 
     Director shall submit to Congress--

       ``(aa) the text of the agreement;
       ``(bb) a certification and justification of how the 
     agreement is consistent with the Agency's duties as 
     conservator or receiver;
       ``(cc) budgetary projections demonstrating the cost to the 
     taxpayer in a 1, 5, and 10-year window;
       ``(dd) independent risk analysis from the Government 
     Accountability Office of the agreement, considering the risk 
     to the short and long-term viability of the regulated entity 
     and the United States taxpayer; and
       ``(ee) a time table for the expiration of the agreement.''.

      Subtitle D--Fannie Mae and Freddie Mac in the Federal Budget

     SEC. 1341. ON-BUDGET STATUS OF FANNIE MAE AND FREDDIE MAC.

       (a) In General.--Notwithstanding any other provision of 
     law, the receipts and disbursements, including the 
     administrative expenses, of the Federal National Mortgage 
     Association and the Federal Home Loan Mortgage Corporation 
     shall be counted as new budget authority, outlays, receipts, 
     or deficit or surplus for purposes of--
       (1) the Budget of the United States Government as submitted 
     by the President;
       (2) the congressional budget;
       (3) the Statutory Pay-As-You-Go Act of 2010; and
       (4) the Balanced Budget and Emergency Deficit Control Act 
     of 1985 (or any successor statute).
       (b) Expiration.--The budgetary treatment of the Federal 
     National Mortgage Association or Federal Home Loan Mortgage 
     Corporation or any functional replacements under subsection 
     (a) shall continue with respect to such entities until such 
     entities are no longer under Federal conservatorship or 
     receivership as authorized by the Housing and Economic 
     Recovery Act of 2008 (Public Law 110-289) or any successor 
     statute.

     SEC. 1342. BUDGETARY TREATMENT OF FANNIE MAE AND FREDDIE MAC.

       All costs to the Government of the activities of or under 
     the Federal National Mortgage Association, Federal Home Loan 
     Mortgage Corporation and any functional replacements or any 
     modification of such entities shall be determined on a fair 
     value basis.

     SEC. 1343. FANNIE MAE AND FREDDIE MAC DEBT SUBJECT TO PUBLIC 
                   DEBT LIMIT.

       (a) In General.--For purposes of section 3101(b) of chapter 
     31 of title 31, United States Code, the face amount of 
     obligations issued by the Federal National Mortgage 
     Association and by the Federal Home Loan Mortgage Corporation 
     or any functional replacements and outstanding shall be 
     treated as issued by the United States Government under that 
     section.
       (b) Temporary Increase in the Public Debt Limit.--The limit 
     on the obligation in section 3101(b) of title 31, United 
     States Code, shall be increased by the face amount of 
     obligations issued by the Federal National Mortgage 
     Association and the Federal Home Loan Mortgage Corporation 
     and outstanding on April 15, 2010.
       (c) Expiration.--
       (1) Obligations.--The obligations of Federal National 
     Mortgage Association or Federal Home Loan Mortgage 
     Corporation or any functional replacements shall continue to 
     be treated as issued by the United States Government with 
     respect to such entities until such entities no longer have 
     in place an agreement with the Secretary of the Treasury for 
     the purchase of obligations and securities authorized by the 
     Housing and Economic Recovery Act of 2008 (Public Law 110-
     289) or any successor statute.
       (2) Debt limit.--Any temporary increase in the public debt 
     limit authorized in subsection (b) with respect to the 
     obligations of Federal National Mortgage Association or 
     Federal Home Loan Mortgage Corporation shall be reversed with 
     respect to such entities when Federal National Mortgage 
     Association or Federal Home Loan Mortgage Corporation or any 
     functional replacements no longer have in place an agreement 
     with the Secretary of the Treasury for the purchase of 
     obligations and securities authorized by the Housing and 
     Economic Recovery Act of 2008 (Public Law 110-289) or any 
     successor statute.

     SEC. 1344. DEFINITIONS.

       In this subtitle, the following definitions shall apply:
       (1) Fair value.--The term ``fair value'' shall have the 
     same meaning as the definition of fair value outlined in 
     Financial Accounting Standards No. 157, or any successor 
     thereto, issued by the Financial Accounting Standards Board.
       (2) Functional replacements.--The term ``functional 
     replacements'' means any organization, agreement, or other 
     arrangement that would perform the public functions of 
     Federal National Mortgage Association or Federal Home Loan 
     Mortgage Corporation.
       (3) Modification.--
       (A) In general.--The term ``modification'' means any 
     government action that alters the estimated fair value of the 
     activities of the Federal National Mortgage Association or 
     Federal Home Loan Mortgage Corporation or any functional 
     replacements.
       (B) Cost.--The cost of a modification is the difference 
     between the current estimate of the fair value of the 
     activities of the Federal National Mortgage Association or 
     Federal Home Loan Mortgage Corporation or any functional 
     replacements and the estimate of the fair value of such 
     activities as modified.
                                 ______
                                 
  SA 3840. Mr. CARDIN (for himself and Mr. Grassley) submitted an 
amendment intended to be proposed to amendment SA 3739 proposed by Mr. 
Reid (for Mr. Dodd (for himself and Mrs. Lincoln)) to the bill S. 3217, 
to promote the financial stability of the United States by improving 
accountability and transparency in the financial system, to end ``too 
big to fail'', to protect the American taxpayer by ending bailouts, to 
protect consumers from abusive financial services practices, and for 
other purposes; which was ordered to lie on the table; as follows:

       On page 977, line 19, strike ``The Securities'' and insert 
     the following:
       (a) In General.--The Securities
       On page 994, between lines 2 and 3, insert the following:
       (b) Protection for Employees of Nationally Recognized 
     Statistical Rating Organizations.--Section 1514A(a) of title 
     18, United States Code, is amended--
       (1) by inserting ``or nationally recognized statistical 
     rating organization (as defined in section 3(a) of the 
     Securities Exchange Act of 1934 (15 U.S.C. 78c),'' after 
     ``78o(d)),''; and
       (2) by inserting ``or nationally recognized statistical 
     rating organization'' after ``such company''.
                                 ______
                                 
  SA 3841. Mr. MENENDEZ submitted an amendment intended to be proposed 
to amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for himself 
and Mrs. Lincoln)) to the bill S. 3217, to promote the financial 
stability of the United States by improving accountability and 
transparency in the financial system, to end ``too big to fail'', to 
protect the American taxpayer by ending bailouts, to protect consumers 
from abusive financial services practices, and for other purposes; 
which was ordered to lie on the table; as follows:

       On page 977, line 19, strike ``The'' and insert ``(a) 
     SECURITIES EXCHANGE ACT OF 1934.--The''.
       On page 994, between lines 2 and 3, insert the following:
       (b) Section 1514A of Title 18, United States Code.--
       (1) Statute of limitations; jury trial.--Section 
     1514A(b)(2) of title 18, United States Code, is amended--
       (A) in subparagraph (D)--
       (i) by striking ``90'' and inserting ``180''; and
       (ii) by striking the period at the end and inserting ``, or 
     after the date on which the employee became aware of the 
     violation.''; and
       (B) by adding at the end the following:
       ``(E) Jury trial.--A party to an action brought under 
     paragraph (1)(B) shall be entitled to trial by jury.''.
       (2) Compensatory damages.--Section 1514A(c)(2)(C) of title 
     18, United States Code, is amended by inserting 
     ``compensatory damages, including'' before ``compensation''.
       (3) Private securities litigation witnesses; 
     nonenforceability; information.--Section 1514A of title 18, 
     United States Code, is amended by adding at the end the 
     following:
       ``(e) Private Securities Litigation.--No employer may 
     discharge, demote, suspend, threaten, harass, directly or 
     indirectly, or in any other manner discriminate against, an 
     individual in the terms and conditions of employment because 
     of any lawful act done by the individual in providing 
     information, or assisting in any investigation or judicial or 
     administrative action, relating to a private securities 
     litigation action under section 21F of the Securities 
     Exchange Act of 1934 (15 U.S.C. 78u-4).
       ``(f) Nonenforceability of Certain Provisions Waiving 
     Rights and Remedies or Requiring Arbitration of Disputes.--
       ``(1) Waiver of rights and remedies.--Except as provided 
     under paragraph (3), the rights and remedies provided for in 
     this section may not be waived by any agreement, policy form, 
     or condition of employment, including by a predispute 
     arbitration agreement.
       ``(2) Predispute arbitration agreements.--Except as 
     provided under paragraph

[[Page S3269]]

     (3), no predispute arbitration agreement shall be valid or 
     enforceable, if the agreement requires arbitration of a 
     dispute arising under this section.
       ``(3) Exception for collective bargaining agreements.--An 
     arbitration provision in a collective bargaining agreement 
     shall be enforceable as to disputes arising under the 
     collective bargaining agreement.''.
       (4) Undisclosed liabilities.--Section 1514A(a)(1) of title 
     18, United States Code, is amended to read as follows:
       ``(1) to provide information, cause information to be 
     provided, or otherwise assist in an investigation regarding 
     any conduct which the employee reasonably believes 
     constitutes a violation of section 1341, 1343, 1344, or 1348, 
     any rule or regulation of the Securities and Exchange 
     Commission, any provision of Federal law relating to fraud 
     against shareholders, or any information which has not been 
     disclosed to shareholders that relates to a potential 
     liability of the company that, if incurred, could affect the 
     value of shareholder investments, when the information or 
     assistance is provided to or the investigation is conducted 
     by--
       ``(A) a Federal regulatory or law enforcement agency;
       ``(B) any Member of Congress or any committee of Congress; 
     or
       ``(C) a person with supervisory authority over the employee 
     (or such other person working for the employer who has the 
     authority to investigate, discover, or terminate misconduct); 
     or''.
       (5) Technical and conforming amendment.--Section 
     1514A(b)(1) of title 18, United States Code, is amended by 
     inserting ``or (e)'' after ``subsection (a)''.
                                 ______
                                 
  SA 3842. Mr. NELSON of Florida (for himself and Mr. Brown of 
Massachusetts) submitted an amendment intended to be proposed to 
amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mrs. Lincoln)) to the bill S. 3217, to promote the financial stability 
of the United States by improving accountability and transparency in 
the financial system, to end ``too big to fail'', to protect the 
American taxpayer by ending bailouts, to protect consumers from abusive 
financial services practices, and for other purposes; which was ordered 
to lie on the table; as follows:

       On page 780, strike lines 1 through 3 and insert the 
     following:
       (B) in the matter following subsection (b)--
       (i) by striking ``(but not'' and all that follows through 
     ``insider trading)''; and
       (ii) by striking ``(as defined in section 206B of the 
     Gramm-Leach-Bliley Act)'';
                                 ______
                                 
  SA 3843. Mr. CARDIN submitted an amendment intended to be proposed by 
him to the bill S. 3217, to promote the financial stability of the 
United States by improving accountability and transparency in the 
financial system, to end ``too big to fail'', to protect the American 
taxpayer by ending bailouts, to protect consumers from abusive 
financial services practices, and for other purposes; which was ordered 
to lie on the table; as follows:

       At the end of subtitle A of title I, add the following:

     SEC. 122. INCREASE IN DEPOSIT AND SHARE INSURANCE AMOUNTS.

       (a) Permanent Increase in Deposit Insurance.--
       (1) Insurance amount.--Section 11(a)(1)(E) of the Federal 
     Deposit Insurance Act (12 U.S.C. 1821(a)(1)(E)) is amended by 
     striking ``$100,000'' and inserting ``$250,000''.
       (2) Borrowing authority.--The Board of Directors of the 
     Corporation may request from the Secretary, and the Secretary 
     shall approve, a loan or loans in an amount or amounts 
     necessary to carry out this subsection, without regard to the 
     limitations on such borrowing under section 14(a) and 15(c) 
     of the Federal Deposit Insurance Act (12 U.S.C. 1824(a), 
     1825(c)).
       (b) Permanent Increase in Share Insurance.--
       (1) Insurance amount.--Section 207(k)(5) of the Federal 
     Credit Union Act (12 U.S.C. 1787(k)(5)) is amended by 
     striking ``$100,000'' and inserting ``$250,000''.
       (2) Borrowing authority.--The National Credit Union 
     Administration Board may request from the Secretary, and the 
     Secretary shall approve, a loan or loans in an amount or 
     amounts necessary to carry out this subsection, without 
     regard to the limitations on such borrowing under section 
     203(d)(1) of the Federal Credit Union Act (12 U.S.C. 
     1783(d)(1)).
       (c) Repeal.--Section 136 of the Emergency Economic 
     Stabilization Act of 2008 (12 U.S.C. 5241) is repealed, 
     effective on the date of enactment of this Act.
                                 ______
                                 
  SA 3844. Mr. BROWNBACK (for himself, Mr. Feingold, Mr. Durbin, Mr. 
Specter, Mr. Brown of Ohio, Mr. Johnson, and Mr. Whitehouse) submitted 
an amendment intended to be proposed to amendment SA 3739 proposed by 
Mr. Reid (for Mr. Dodd (for himself and Mrs. Lincoln)) to the bill S. 
3217, to promote the financial stability of the United States by 
improving accountability and transparency in the financial system, to 
end ``too big to fail'', to protect the American taxpayer by ending 
bailouts, to protect consumers from abusive financial services 
practices, and for other purposes; which was ordered to lie on the 
table; as follows:

       On page 1565, after line 23, add the following:

                  TITLE XIII--CONGO CONFLICT MINERALS

     SEC. 1301. SENSE OF CONGRESS ON EXPLOITATION AND TRADE OF 
                   COLUMBITE-TANTALITE, CASSITERITE, GOLD, AND 
                   WOLFRAMITE ORIGINATING IN DEMOCRATIC REPUBLIC 
                   OF CONGO.

       It is the sense of Congress that the exploitation and trade 
     of columbite-tantalite, cassiterite, gold, and wolframite in 
     the eastern Democratic Republic of Congo is helping to 
     finance extreme levels of violence in the eastern Democratic 
     Republic of Congo, particularly sexual and gender-based 
     violence, and contributing to an emergency humanitarian 
     situation therein, warranting the provisions of section 13(o) 
     of the Securities Exchange Act of 1934, as added by section 
     1302.

     SEC. 1302. DISCLOSURE TO SECURITIES AND EXCHANGE COMMISSION 
                   RELATING TO COLUMBITE-TANTALITE, CASSITERITE, 
                   GOLD, AND WOLFRAMITE ORIGINATING IN DEMOCRATIC 
                   REPUBLIC OF CONGO.

       Section 13 of the Securities Exchange Act of 1934 (15 
     U.S.C. 78m), as amended by section 763 of this Act, is 
     further amended by adding at the end the following new 
     subsection:
       ``(o) Disclosures to Commission Relating to Columbite-
     Tantalite, Cassiterite, Gold, and Wolframite Originating in 
     Democratic Republic of Congo.--
       ``(1) In general.--Not later than 180 days after the date 
     of the enactment of this subsection, the Commission shall 
     promulgate rules requiring any person described in paragraph 
     (2)--
       ``(A) to disclose annually to the Commission in a report--
       ``(i) whether the columbite-tantalite, cassiterite, gold, 
     or wolframite that was necessary as described in paragraph 
     (2)(A)(ii) in the year for which such report is submitted 
     originated or may have originated in the Democratic Republic 
     of Congo or an adjoining country; and
       ``(ii) a description of the measures taken by the person, 
     which may include an independent audit, to exercise due 
     diligence on the source and chain of custody of such 
     columbite-tantalite, cassiterite, gold, or wolframite, or 
     derivatives of such minerals, in order to ensure that the 
     activities of such person that involve such minerals or 
     derivatives did not directly or indirectly finance or benefit 
     armed groups in the Democratic Republic of Congo or an 
     adjoining country; and
       ``(B) make the information disclosed under subparagraph (A) 
     available to the public on the Internet website of the 
     person.
       ``(2) Person described.--
       ``(A) In general.--A person is described in this paragraph 
     if--
       ``(i) the person is required to file reports to the 
     Commission under subsection (a)(2); and
       ``(ii) columbite-tantalite, cassiterite, gold, or 
     wolframite is necessary to the functionality or production of 
     a product of such person.
       ``(B) Derivatives.--For purposes of this paragraph, if a 
     derivative of a mineral is necessary to the functionality or 
     production of a product of a person, such mineral shall also 
     be considered necessary to the functionality or production of 
     a product of the person.
       ``(3) Revisions and waivers.--The Commission shall revise 
     or temporarily waive the requirements described in paragraph 
     (1) if the President determines that such revision or waiver 
     is in the public interest.
       ``(4) Termination of disclosure requirements.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     the requirements of paragraph (1) shall terminate on the date 
     that is 5 years after the date of the enactment of this 
     subsection.
       ``(B) Extension by secretary of state.--The date described 
     in subparagraph (A) shall be extended by 1 year for each year 
     in which the Secretary of State certifies that armed parties 
     to the ongoing armed conflict in the Democratic Republic of 
     Congo or adjoining countries continue to be directly involved 
     and benefitting from commercial activity involving columbite-
     tantalite, cassiterite, gold, or wolframite.
       ``(5) Adjoining country defined.--In this subsection, the 
     term `adjoining country', with respect to the Democratic 
     Republic of Congo, means a country that shares an 
     internationally recognized border with the Democratic 
     Republic of Congo.''.

     SEC. 1303. REPORT.

       Not later than 2 years after the date of the enactment of 
     this Act, the Comptroller General of the United States shall 
     submit to Congress a report that includes the following:
       (1) An assessment of the effectiveness of section 13(o) of 
     the Securities Exchange Act of 1934, as added by section 
     1302, in promoting peace and security in the eastern 
     Democratic Republic of Congo.
       (2) A description of the problems, if any, encountered by 
     the Securities and Exchange Commission in carrying out the 
     provisions of such section 13(o).
       (3) A description of the adverse impacts of carrying out 
     the provisions of such section 13(o), if any, on communities 
     in the eastern Democratic Republic of Congo.
       (4) Recommendations for legislative or regulatory actions 
     that can be taken--

[[Page S3270]]

       (A) to improve the effectiveness of the provisions of such 
     section 13(o) to promote peace and security in the eastern 
     Democratic Republic of Congo;
       (B) to resolve the problems described pursuant to paragraph 
     (2), if any; and
       (C) to mitigate the adverse impacts described pursuant 
     paragraph (3), if any.
                                 ______
                                 
  SA 3845. Mr. KAUFMAN (for himself and Mr. Grassley), submitted an 
amendment intended to be proposed to amendment SA 3739 proposed by Mr. 
Reid (for Mr. Dodd (for himself and Mrs. Lincoln)) to the bill S. 3217, 
to promote the financial stability of the United States by improving 
accountability and transparency in the financial system, to end ``too 
big to fail'', to protect the American taxpayer by ending bailouts, to 
protect consumers from abusive financial services practices, and for 
other purposes; which was ordered to lie on the table; as follows:

       On page 728, between lines 3 and 4, insert the following:

     SEC. 760. IMPROVED TRANSPARENCY.

       (a) Securities.--Section 11A(a)(1) of the Securities 
     Exchange Act of 1934 (15 U.S.C. 78k-1(a)(1)) is amended by 
     adding at the end the following:
       ``(E) Promoting transparency of all markets for securities 
     through dissemination of quotations and orders to all 
     brokers, dealers, and investors, and minimizing conditions 
     under which quotations and orders are hidden or selectively 
     disseminated, will--
       ``(i) foster efficiency;
       ``(ii) enhance competition;
       ``(iii) increase the information available to brokers, 
     dealers, and investors;
       ``(iv) facilitate the offsetting of investors' orders; and
       ``(v) contribute to best execution of such orders.''.
       (b) Commodities.--Section 3(b) of the Commodity Exchange 
     Act (7 U.S.C. 5(b)) is amended--
       (1) by striking ``and'' following ``customer assets;'';
       (2) by striking the period at the end of the second 
     sentence; and
       (3) by adding at the end the following: ``; to promote 
     transparency of all markets through dissemination of 
     quotations and orders to all market participants and market 
     professionals; and to minimize conditions under which 
     quotations and orders are hidden or selectively disseminated. 
     Furthering the purposes of this Act will foster efficiency, 
     enhance competition, increase the information available to 
     market participants, facilitate the offsetting of market 
     participants' orders, and contribute to best execution of 
     such orders.''.
                                 ______
                                 
  SA 3846. Mrs. McCASKILL submitted an amendment intended to be 
proposed to amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for 
himself and Mrs. Lincoln)) to the bill S. 3217, to promote the 
financial stability of the United States by improving accountability 
and transparency in the financial system, to end ``too big to fail'', 
to protect the American taxpayer by ending bailouts, to protect 
consumers from abusive financial services practices, and for other 
purposes; which was ordered to lie on the table; as follows:

       At the end of subtitle C of title III, add the following:

     SEC. 333. DEPOSIT RESTRICTED QUALIFIED TUITION PROGRAMS.

       (a) In General.--Section 18 of the Federal Deposit 
     Insurance Act (12 U.S.C. 1828) is amended by adding at the 
     end the following new subsection:
       ``(y) Deposit Restricted Qualified Tuition Programs.--
       ``(1) Definitions.--For purposes of this subsection, the 
     following definitions shall apply:
       ``(A) Deposit restricted qualified tuition program.--The 
     term `deposit restricted qualified tuition program' means a 
     qualified tuition program in which--
       ``(i) the cash provided by a contributor to such a 
     qualified tuition program may be invested only in deposits 
     insured by the Corporation;
       ``(ii) the contributor may become a participant in the 
     program by depositing funds through the program into an 
     account at a depository institution participating in the 
     program; and
       ``(iii) the program may include multiple depository 
     institutions, subject to the requirements of section 529 of 
     the Internal Revenue Code of 1986, as amended.
       ``(B) Qualified tuition program.--The term `qualified 
     tuition program' has the same meaning as in section 529 of 
     the Internal Revenue Code of 1986, as amended.
       ``(2) Treatment.--Notwithstanding any other provision of 
     the law, the following provisions shall apply with respect to 
     any deposit restricted qualified tuition program:
       ``(A) A deposit restricted qualified tuition program shall 
     be deemed to be an `identified banking product' (as defined 
     in Section 206 of the Gramm-Leach-Bliley Act of 1999) for 
     purposes of the Securities Exchange Act of 1934.
       ``(B) None of the following shall be treated as a security, 
     as defined in section 2(a)(1) the Securities Act of 1933, 
     section 3(a)(10) of the Securities Exchange Act of 1934, or 
     section 2(a)(36) of the Investment Company Act of 1940:
       ``(i) The deposits of cash at an insured depository 
     institution relating to a deposit restricted tuition program.
       ``(ii) Any certificate of deposit or other instrument of an 
     insured depository institution evidencing any such deposit.
       ``(iii) The rights and obligations of participants in a 
     deposit restricted qualified tuition program arising from 
     section 529 of the Internal Revenue Code, as amended.
       ``(C) In no event shall a deposit restricted qualified 
     tuition program, the State entity designated by statute to 
     oversee such program, the administrator appointed to operate 
     the program on behalf of the State or a participating 
     depository institution, be deemed to be an issuer of a 
     security or to be an investment company (as defined in 
     section 3(a) of the Investment Company Act of 1940).''.
       (b) Budget Compliance.--The budgetary effects of this 
     section, for the purpose of complying with the Statutory Pay-
     As-You-Go Act of 2010, shall be determined by reference to 
     the latest statement titled ``Budgetary Effects of PAYGO 
     Legislation'' for this Act, submitted for printing in the 
     Congressional Record by the Chairman of the Committee on the 
     Budget of the House of Representatives, provided that such 
     statement has been submitted prior to the vote on passage.
                                 ______
                                 
  SA 3847. Mr. DODD (for Mr. Leahy (for himself and Mr. Cornyn)) 
proposed an amendment to the bill S. 3111, to establish the Commission 
on Freedom of Information Act Processing Delays; as follows:
       On page 6, line 5, strike ``The Comptroller General of the 
     United States'' and insert ``The Archivist of the United 
     States''.

       On page 7, strike lines 1 through 3, and insert the 
     following:
       (j) Transparency.--All meetings of the Commission shall be 
     open to the public, except that a meeting, or any portion of 
     it, may be closed to the public if it concerns matters or 
     information described in chapter 552b(c) of title 5, United 
     States Code. Interested persons shall be permitted to appear 
     at open meetings and present oral or written statements on 
     the subject matter of the meeting. The Commission may 
     administer oaths or affirmations to any person appearing 
     before the Commission.
                                 ______
                                 
  SA 3848. Mr. WYDEN submitted an amendment intended to be proposed by 
him to the bill S. 3217, to promote the financial stability of the 
United States by improving accountability and transparency in the 
financial system, to end ``too big to fail'', to protect the American 
taxpayer by ending bailouts, to protect consumers from abusive 
financial services practices, and for other purposes; which was ordered 
to lie on the table; as follows:

       At the end of subtitle A of title I, add the following:

     SEC. 122. CERTIFICATIONS BY THE SECRETARY.

       (a) In General.--The Secretary shall, not later than 
     February 28, 2011, and annually thereafter, certify in 
     writing to Congress that the risks to the financial stability 
     of the United States that could arise from the material 
     financial distress or failure of a financial company are 
     sufficiently mitigated by actions authorized to be taken by 
     the Council or the individual members of the Council, in 
     order to ensure than no such financial company will be 
     considered ``too big to fail''.
       (b) Inability To Certify.--If the Secretary is unable to 
     make a certification to Congress as required under subsection 
     (a), the Secretary shall--
       (1) inform Congress of the reasons for such inability; and
       (2) make recommendations to Congress, to the members of the 
     Council, and to the President that would, if implemented, 
     enable the Secretary to provide such certification.
                                 ______
                                 
  SA 3849. Mr. WYDEN submitted an amendment intended to be proposed by 
him to the bill S. 3217, to promote the financial stability of the 
United States by improving accountability and transparency in the 
financial system, to end ``too big to fail'', to protect the American 
taxpayer by ending bailouts, to protect consumers from abusive 
financial services practices, and for other purposes; which was ordered 
to lie on the table; as follows:

       At the end of subtitle G of title X, add the following:

     SEC. 1077. CREDIT CARD RATINGS.

       (a) Research and Analysis.--Not later than 60 days after 
     the date of enactment of this Act, the research unit 
     established by the Director under section 1013(b) shall 
     conduct a study of the credit card industry and the efficacy 
     of establishing a rating system for credit cards, so that 
     consumers are able to compare the terms of credit card 
     accounts for purposes of comparing the level of safety and 
     financial risk with respect to such accounts.
       (b) Report.--Not later than 180 days after the date of 
     enactment of this Act, the Director shall issue a report 
     based on the study required in subsection (a), and shall 
     determine, based on the report, whether establishing a

[[Page S3271]]

     ratings system for credit cards would meaningfully improve 
     the ability of consumers to compare the terms of credit card 
     accounts.
       (c) Rulemaking.--If the Director determines, pursuant to 
     subsection (b), that establishing a ratings system for credit 
     cards would meaningfully improve the ability of consumers to 
     compare the terms of credit card accounts, then not later 
     than 12 months after the date of enactment of this Act, the 
     Director shall issue final rules to establish and disclose to 
     the public the ratings for credit card accounts. Such rules 
     shall include consideration in such ratings of credit 
     practices, including--
       (1) terms of arbitration between the consumer and the 
     credit card account holder;
       (2) the imposition and amounts of fees;
       (3) the ability of the consumer to opt out of a proposed 
     change in the terms of the credit card agreement;
       (4) the manner and methods in which materials and 
     information are presented to consumers, and the degree of 
     conspicuousness with which key terms of the agreement are 
     presented;
       (5) methods for the accrual of interest;
       (6) reading level required to understand the terms of the 
     agreement; and
       (7) such other factors as the Director determines are 
     appropriate with respect to such ratings.
       (d) Consideration of NHTSA Program.--In carrying out 
     subsection (c), the Director shall consider establishing a 5-
     star ratings system similar to the New Car Assessment Program 
     administered by the National Highway Traffic Safety 
     Administration of the Department of Transportation.
                                 ______
                                 
  SA 3850. Mr. VITTER submitted an amendment intended to be proposed to 
amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mrs. Lincoln)) to the bill S. 3217, to promote the financial stability 
of the United States by improving accountability and transparency in 
the financial system, to end ``too big to fail'', to protect the 
American taxpayer by ending bailouts, to protect consumers from abusive 
financial services practices, and for other purposes; which was ordered 
to lie on the table; as follows:

       On page 43, insert between lines 6 and 7, insert the 
     following:
       (3) Applicability to fannie mae and freddie mac.--
     Notwithstanding any other provision of law, the provisions of 
     subsections (b) and (f) shall apply with respect to the 
     Federal National Mortgage Association and the Federal Home 
     Loan Mortgage Corporation in the same manner and to the same 
     extent as those provisions apply to nonbank financial 
     companies supervised by the Board of Governors and large, 
     interconnected bank holding companies.
       At the end of title II, add the following new section and 
     designate accordingly:
       Sec. __.: Applicability to fannie mae and freddie mac.--
     Notwithstanding any other provision of law, this title shall 
     apply with respect to the Federal National Mortgage 
     Association and the Federal Home Loan Mortgage Corporation in 
     the same manner and to the same extent as those provisions 
     apply to nonbank financial companies supervised by the Board 
     of Governors and large, interconnected bank holding 
     companies.
       At the end of subtitle A of title I, add the following:

     SEC. 122. ENHANCED TAXPAYER PROTECTION FROM FANNIE MAE AND 
                   FREDDIE MAC.

       (a) Reestablishing the Maximum Taxpayer Exposure to Fannie 
     Mae and Freddie Mac.-- Section 1367(b)(2) of the Federal 
     Housing Enterprises Financial Safety and Soundness Act of 
     1992 (12 U.S.C. 4617(b)(2)) is amended by adding the 
     following new subparagraph:
        ``(L) Limitation on certain funding.--The Agency, as 
     conservator, shall prohibit the Federal Home Loan Mortgage 
     Corporation or the Federal National Mortgage Association from 
     receiving more than $200,000,000,000 through the Amended and 
     Restated Senior Preferred Stock Purchase Agreement, dated as 
     of September 26, 2008, amended May 6, 2009, and further 
     amended December 24, 2009, between the United States 
     Department of the Treasury and the Federal Home Loan Mortgage 
     Corporation or the Federal National Mortgage Association.''.
       (b) Reestablishing Scheduled Reduction of Mortgage Assets 
     Owned by Fannie Mae and Freddie Mac.--Section 1367(b)(2) of 
     the Federal Housing Enterprises Financial Safety and 
     Soundness Act of 1992 (12 U.S.C. 4617(b)(2)) is amended by 
     adding at the end the following new subparagraph:
       ``(M) Reduction of owned mortgage assets.--
       ``(i) In general.--The Agency, as conservator, shall ensure 
     that a regulated entity does not own, as of any applicable 
     date, mortgage assets in excess of 90.0 percent of the 
     aggregate amount of mortgage assets that the regulated entity 
     owned on December 31 of each of the previous year, provided, 
     that in no event shall the regulated entity be required under 
     this subparagraph to own less than $250,000,000,000 in 
     mortgage assets.
       ``(ii) Definition of mortgage assets.--For purposes of this 
     subparagraph, the term `mortgage assets' means with respect 
     to a regulated entity, assets of such entity consisting of 
     mortgages, mortgage loans, mortgage-related securities, 
     participation certificates, mortgage-backed commercial paper, 
     obligations of real estate mortgage investment conduits and 
     similar assets, in each case to the extent such assets would 
     appear on the balance sheet of such entity in accordance with 
     generally accepted accounting principles.''.
       (c) Affordable Housing Goals.-- 
       Repeal.--The Federal Housing Enterprises Financial Safety 
     and Soundness Act of 1992 is amended by striking sections 
     1331 through 1336 (12 U.S.C. 4561-6).
       (2) Conforming amendments.--Federal Housing Enterprises 
     Financial Safety and Soundness Act of 1992 is amended--
       (A) in section 1303(28) (12 U.S.C. 4502(28)), by striking 
     ``and, for the purposes'' and all that follows through 
     ``designated disaster areas'';
       (B) in section 1324(b)(1)(A) (12 U.S.C. 4544(b)(1)(A))--
       (i) by striking clauses (i), (ii), and (iv);
       (ii) in clause (iii), by inserting ``and'' after the 
     semicolon at the end; and
       (iii) by redesignating clauses (iii) and (v) as clauses (i) 
     and (ii), respectively;
       (C) in section 1338(c)(10) (12 U.S.C. 4568(c)(10)), by 
     striking subparagraph (E);
       (D) in section 1339(h) (12 U.S.C. 4569), by striking 
     paragraph (7);
       (E) in section 1341 (12 U.S.C. 4581)--
       (i) in subsection (a)--
       (I) in paragraph (1), by inserting ``or'' after the 
     semicolon at the end;
       (II) in paragraph (2), by striking the semicolon at the end 
     and inserting a period; and
       (III) by striking paragraphs (3) and (4); and
       (ii) in subsection (b)(2)--
       (I) in subparagraph (A), by inserting ``or'' after the 
     semicolon at the end;
       (II) by striking subparagraphs (B) and (C); and
       (III) by redesignating subparagraph (D) as subparagraph 
     (B);
       (F) in section 1345(a) (12 U.S.C. 4585(a))--
       (i) in paragraph (1), by inserting ``or'' after the 
     semicolon at the end;
       (ii) in paragraph (2), by striking the semicolon at the end 
     and inserting a period; and
       (iii) by striking paragraphs (3) and (4); and
       (G) in section 1371(a)(2) (12 U.S.C. 4631(a)(2))--
       (i) by striking ``with any housing goal established under 
     subpart B of part 2 of subtitle A of this title,''; and
       (ii) by striking ``section 1336 or''.
                                 ______
                                 
  SA 3851. Mr. VITTER submitted an amendment intended to be proposed to 
amendment SA 3739 proposed by Reid for Mr. Dodd (for himself and Mrs. 
Lincoln) to the bill S. 3217, to promote the financial stability of the 
United States by improving accountability and transparency in the 
financial system, to end ``too big to fail,'' to protect the American 
taxpayer by ending bailouts, to protect consumers from abusive 
financial services practices, and for other purposes; which was ordered 
to lie on the table; as follows:

       On page 43, insert between lines 6 and 7, insert the 
     following:
       (3) Applicability to fannie mae and freddie mac.--
     Notwithstanding any other provision of law, the provisions of 
     subsections (b) through (f) shall apply with respect to the 
     Federal National Mortgage Association and the Federal Home 
     Loan Mortgage Corporation in the same manner and to the same 
     extent as those provisions apply to nonbank financial 
     companies supervised by the Board of Governors and large, 
     interconnected bank holding companies.
       At the end of title II, add the following new section and 
     designate accordingly:
       Sec. __.:Applicability to fannie mae and freddie mac.--
     Notwithstanding any other provision of law, this title shall 
     apply will respect to the Federal National Mortgage 
     Association and the Federal Home Loan Mortgage Corporation in 
     the same manner and to the same extent as those provisions 
     apply to nonbank financial companies supervised by the Board 
     of Governors and large, interconnected bank holding 
     companies.
       At the end of subtitle A of title I, add the following:

     SEC. 122. ENHANCED TAXPAYER PROTECTION FROM FANNIE MAE AND 
                   FREDDIE MAC.

       (a) Reestablishing the Maximum Taxpayer Exposure to Fannie 
     Mae and Freddie Mac.--Section 1367(b)(2) of the Federal 
     Housing Enterprises Financial Safety and Soundness Act of 
     1992 (12 U.S.C. 4617(b)(2)) is amended by adding the 
     following new subparagraph:
       ``(L) Limitation on certain funding.--The Agency, as 
     conservator, shall prohibit the Federal Home Loan Mortgage 
     Corporation or the Federal National Mortgage Association from 
     receiving more than $200,000,000,000 through the Amended and 
     Restated Senior Preferred Stock Purchase Agreement, dated as 
     of September 26, 2008, amended May 6, 2009, and further 
     amended December 24, 2009, between the United States 
     Department of the Treasury and the Federal Home Loan Mortgage 
     Corporation or the Federal National Mortgage Association.''.
       (b) Reestablishing Scheduled Reduction of Mortgage Assets 
     Owned by Fannie Mae and Freddie Mac.--Section 1367(b)(2) of 
     the Federal Housing Enterprises Financial Safety and 
     Soundness Act of 1992 (12 U.S.C. 4617(b)(2)) is amended by 
     adding at the end the following new subparagraph:
       ``(M) Reduction of owned mortgage assets.--
       ``(i) In general.--The Agency, as conservator, shall ensure 
     that a regulated entity

[[Page S3272]]

     does not own, as of any applicable date, mortgage assets in 
     excess of 90.0 percent of the aggregate amount of mortgage 
     assets that the regulated entity owned on December 31 of each 
     of the previous year, provided, that in no event shall the 
     regulated entity be required under this subparagraph to own 
     less than $250,000,000,000 in mortgage assets.
       ``(ii) Definition of mortgage assets.--For purposes of this 
     subparagraph, the term `mortgage assets' means with respect 
     to a regulated entity, assets of such entity consisting of 
     mortgages, mortgage loans, mortgage-related securities, 
     participation certificates, mortgage-backed commercial paper, 
     obligations of real estate mortgage investment conduits and 
     similar assets, in each case to the extent such assets would 
     appear on the balance sheet of such entity in accordance with 
     generally accepted accounting principles.''
                                 ______
                                 
  SA 3852. Mr. DeMINT (for himself and Mr. Vitter) submitted an 
amendment intended to be proposed by him to the bill S. 3217, to 
promote the financial stability of the United States by improving 
accountability and transparency in the financial system, to end ``too 
big to fail'', to protect the American taxpayer by ending bailouts, to 
protect consumers from abusive financial services practices, and for 
other purposes; which was ordered to lie on the table; as follows:

       At the appropriate place, insert the following:

     SEC. __. BORDER FENCE COMPLETION.

       (a) Minimum Requirements.--Section 102(b)(1) of the Illegal 
     Immigration Reform and Immigrant Responsibility Act of 1996 
     (8 U.S.C. 1103 note) is amended--
       (1) in subparagraph (A), by adding at the end the 
     following: ``Fencing that does not effectively restrain 
     pedestrian traffic (such as vehicle barriers and virtual 
     fencing) may not be used to meet the 700-mile fence 
     requirement under this subparagraph.'';
       (2) in subparagraph (B)--
       (A) in clause (i), by striking ``and'' at the end;
       (B) in clause (ii), by striking the period at the end and 
     inserting ``; and''; and
       (C) by adding at the end the following:
       ``(iii) not later than 1 year after the date of the 
     enactment of the Restoring American Financial Stability Act 
     of 2010, complete the construction of all the reinforced 
     fencing and the installation of the related equipment 
     described in subparagraph (A).''; and
       (3) in subparagraph (C), by adding at the end the 
     following:
       ``(iii) Funding not contingent on consultation.--Amounts 
     appropriated to carry out this paragraph may not be impounded 
     or otherwise withheld for failure to fully comply with the 
     consultation requirement under clause (i).''.
       (b) Report.--Not later than 180 days after the date of the 
     enactment of the Restoring American Financial Stability Act 
     of 2010, the Secretary of Homeland Security shall submit a 
     report to Congress that describes--
       (1) the progress made in completing the reinforced fencing 
     required under section 102(b)(1) of the Illegal Immigration 
     Reform and Immigrant Responsibility Act of 1996 (8 U.S.C. 
     1103 note), as amended by this section; and
       (2) the plans for completing such fencing not later than 1 
     year after the date of the enactment of this Act.
                                 ______
                                 
  SA 3853. Mr. BROWN of Ohio (for himself and Mr. Kaufman), submitted 
an amendment intended to be proposed to amendment SA 3739 proposed by 
Mr. Reid (for Mr. Dodd (for himself and Mrs. Lincoln)) to the bill S. 
3217, to promote the financial stability of the United States by 
improving accountability and transparency in the financial system, to 
end ``too big to fail'', to protect the American taxpayer by ending 
bailouts, to protect consumers from abusive financial services 
practices, and for other purposes; which was ordered to lie on the 
table; as follows:

       On page 92, strike lines 8 through 12 and insert the 
     following:
       (ii) liquidity requirements;
       (iii) resolution plan and credit exposure report 
     requirements; and
       (iv) concentration limits.
       On page 105, between lines 2 and 3, insert the following:
       (i) Leverage Ratio for Bank Holding Companies and Financial 
     Companies.--
       (1) Amendment.--The Bank Holding Company Act of 1956 (12 
     U.S.C. 1841 et seq.) is amended by adding at the end the 
     following:

     ``SEC. 13. LIMITS ON LEVERAGE.

       ``(a) Definitions.--In this section, the following 
     definitions shall apply:
       ``(1) Financial company.--The term `financial company' 
     means any nonbank financial company, as that term is defined 
     in section 102 of the Restoring American Financial Stability 
     Act of 2010, that is supervised by the Board.
       ``(2) Incorporated terms.--The terms `average total 
     consolidated assets' and `tier 1 capital' have the meanings 
     given those terms in part 225 of title 12, Code of Federal 
     Regulations, or any successor thereto.
       ``(b) Leverage Ratio Requirements for Bank Holding 
     Companies and Financial Companies.--
       ``(1) Leverage ratio.--A bank holding company or financial 
     company may not maintain tier 1 capital in an amount that is 
     less than 6 percent of the average total consolidated assets 
     of the bank holding company or financial holding company.
       ``(2) Balance sheet leverage ratio.--A bank holding company 
     or financial company may not maintain less than 6 percent of 
     tier 1 capital for all outstanding balance sheet liabilities, 
     as required to be recorded under section 13(o) of the 
     Securities Exchange Act of 1934.
       ``(c) Exemptions.--
       ``(1) In general.--The Board may adjust the leverage ratio 
     requirements under subsection (b) for any class of 
     institutions, based upon the size or activity of such class 
     of institutions. No adjustment made under this paragraph may 
     allow an institution to carry less capital than is required 
     under subsection (b).
       ``(2) International agreements.--Consistent with this 
     subsection, the Board may adjust the leverage ratio 
     requirements under subsection (b), as necessary to harmonize 
     such ratios with official international agreements regarding 
     capital standards, if the Board determines that the capital 
     standards under such international agreements are 
     commensurate with the credit, market, operational, or other 
     risks posed by the bank holding companies or financial 
     companies to which such international agreements apply.
       ``(3) Temporary emergency exemption.--
       ``(A) In general.--The appropriate Federal banking agency 
     may, in a manner consistent with this subsection, grant any 
     bank holding company a temporary emergency exemption from the 
     leverage ratio requirements under subsection (b), if the 
     appropriate Federal banking agency determines such an 
     exemption is necessary to prevent an imminent threat to the 
     financial stability of the United States.
       ``(B) Publication.--
       ``(i) Publication required.--The appropriate Federal 
     banking agency shall publish a notice of any exemption 
     granted under this paragraph in the Federal Register within a 
     reasonable period after granting the exemption, and in no 
     case later than 90 days after the date on which the exemption 
     is granted.
       ``(ii) Contents.--The notice under clause (i) shall 
     include--

       ``(I) the name of the bank holding company or financial 
     company that is granted an exemption;
       ``(II) the reason for the exemption; and
       ``(III) a plan detailing the manner by which the bank 
     holding company will be brought into compliance with 
     subsection (b).

       ``(d) Leverage Ratio Requirements for Operating 
     Subsidiaries of Bank Holding Companies and Financial 
     Companies.--Notwithstanding any other provision of law 
     applicable to insured depository institutions, not later than 
     1 year after the date of enactment of the Restoring American 
     Financial Stability Act of 2010, the Board shall promulgate 
     regulations establishing leverage ratio requirements under 
     subsection (b) for the operating subsidiaries of bank holding 
     companies and financial companies.
       ``(e) Prompt Corrective Action.--
       ``(1) Authorities.--The Board shall require a bank holding 
     company or financial company that violates subsection (b) to 
     comply with the leverage ratio requirements under subsection 
     (b) by--
       ``(A) selling or otherwise transferring assets or off-
     balance sheet items to unaffiliated firms;
       ``(B) terminating 1 or more activities of the bank holding 
     company or financial company; or
       ``(C) imposing conditions on the manner in which the bank 
     holding company or financial company conducts an activity of 
     the bank holding company or financial company.
       ``(2) Corrective action plan.--Not later than 60 days after 
     the Board determines that a bank holding company or financial 
     holding company has violated subsection (b), the Board shall 
     submit to the Committee on Banking, Housing, and Urban 
     Affairs of the Senate and the Committee on Financial Services 
     of the House of Representatives a plan detailing the manner 
     by which the bank holding company or financial company will 
     be brought into compliance with subsection (b).
       ``(3) Reports to congress.--
       ``(A) Written reports.--At the end of each 60-day period 
     following the date on which the Board submits a plan under 
     paragraph (2) during which a bank holding company or 
     financial company remains in violation of subsection (b), the 
     Board shall submit to the Committee on Banking, Housing, and 
     Urban Affairs of the Senate and the Committee on Financial 
     Services of the House of Representatives a report on the 
     compliance of the bank holding company or financial holding 
     company with the plan.
       ``(B) Testimony.--At the end of each 120-day period 
     following the date on which the Board submits a plan under 
     paragraph (2) during which a bank holding company or 
     financial company remains in violation of subsection (b), the 
     Board shall testify before the Committee on Banking, Housing, 
     and Urban Affairs of the Senate and the Committee on 
     Financial Services of the House of Representatives with 
     respect to the compliance of the bank holding company or 
     financial holding company with the plan.''.
       (2) Effective date.--The amendment made by this subsection 
     shall take effect 1 year after the date of enactment of this 
     Act.


[[Page S3273]]


       On page 497, line 14, strike ``SEC. 13'' and insert ``SEC. 
     14''.

       On page 976, between lines 4 and 5, insert the following:

     SEC. 919C. FINANCIAL REPORTING.

       Section 13 of the Securities Exchange Act of 1934 (15 
     U.S.C. 78m), as amended by this Act, is amended by adding at 
     the end the following:
       ``(o) Standard Balance Sheet Calculation for Reports.--
       ``(1) Standard established.--Not later than 1 year after 
     the date of enactment of the Restoring American Financial 
     Stability Act of 2010, the Commission, or a standard setter 
     designated by and under the oversight of the Commission, 
     shall establish a standard requiring each that each issuer 
     that is required to submit reports to the Commission under 
     this section record all assets and liabilities of the issuer 
     on the balance sheet of the issuer.
       ``(2) Contents.--The standard established under paragraph 
     (1) shall require that--
       ``(A) the recorded amount of assets and liabilities reflect 
     a reasonable assessment by the issuer of the most likely 
     outcomes with respect to the amount of assets and 
     liabilities, given information available at the time of the 
     report;
       ``(B) each issuer record any financing of assets for which 
     the issuer has more than minimal economic risks or rewards; 
     and
       ``(C) if an issuer cannot determine the amount of a 
     particular liability, the issuer may exclude that liability 
     from the balance sheet of the issuer only if the issuer 
     discloses an explanation of--
       ``(i) the nature of the liability and purpose for incurring 
     the liability;
       ``(ii) the most likely loss and the maximum loss the issuer 
     may incur from the liability;
       ``(iii) whether any other person has recourse against the 
     issuer with respect to the liability and, if so, the 
     conditions under which such recourse may occur; and
       ``(iv) whether the issuer has any continuing involvement 
     with an asset financed by the liability or any beneficial 
     interest in the liability.
       ``(3) Compliance.--The Commission shall issue rules to 
     ensure compliance with this subsection that allow for 
     enforcement by the Commission and civil liability under this 
     title and the Securities Act of 1933.''.
                                 ______
                                 
  SA 3854. Mr. REED (for himself and Mr. Akaka) submitted an amendment 
intended to be proposed to amendment SA 3739 proposed by Mr. Reid (for 
Mr. Dodd (for himself and Mrs. Lincoln)) to the bill S. 3217, to 
promote the financial stability of the United States by improving 
accountability and transparency in the financial system, to end ``too 
big to fail'', to protect the American taxpayer by ending bailouts, to 
protect consumers from abusive financial services practices, and for 
other purposes; which was ordered to lie on the table; as follows:

       On page 1187, line 9, strike ``effective.'' and insert the 
     following: ``effective.

        Subtitle K--Additional Amendments to the Securities Laws

     SEC. 992. 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 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 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 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 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 
     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

[[Page S3274]]

       ``(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 matter 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 
     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.''.
       (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

[[Page S3275]]

     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. 993. 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 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) in the matter preceding subparagraph (A), 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:
       ``(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. 994. 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.''.

[[Page S3276]]

       (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 performs material services upon which a 
     registered public accounting firm relies in the conduct of an 
     audit or interim review, or issues an audit report, performs 
     audit work, or conducts interim reviews, the foreign public 
     accounting firm shall--
       ``(A) produce the audit work papers of the foreign public 
     accounting firm and all other documents of the firm related 
     to any such audit work or interim review to the Commission or 
     the Board, upon the request of 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.'';
       (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 
     request by the Commission or the Board under this section and 
     any process, pleadings, or other papers in any action brought 
     to enforce this section.
       ``(2) Specific audit work.--Any foreign public accounting 
     firm that performs material services upon which a registered 
     public accounting firm relies in the conduct of an audit or 
     interim review, or issues an audit report, performs audit 
     work, or performs interim reviews, shall designate to the 
     Commission or the Board an agent in the United States upon 
     whom may be served any request by the Commission or the Board 
     under this section and any process, pleading, or other papers 
     in any action brought to enforce 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

[[Page S3277]]

     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.''.
       (g) Conforming Amendment With Respect to Registration.--
     Section 102(b)(3)(A) of the Sarbanes-Oxley Act of 2002 (15 
     U.S.C. 7212(b)(3)(A)) is amended by striking ``by the Board'' 
     and inserting ``by the Commission or the Board''.

     SEC. 995. MODERNIZATION OF INVESTOR PROTECTIONS.

       (a) 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''.
       (b) 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''.
       (c) 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) in clause (vii), by striking the colon at the end and 
     inserting a comma;
       (2) by inserting before ``Provided,'' the following:
       ``(viii) 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:''; and

       (3) in clause (vii), by striking ``two'' and inserting 
     ``5''.
       (d) 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''.
       (e) 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. 996. 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

[[Page S3278]]

     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).

     SEC. 997. MUNICIPAL SECURITIES RULEMAKING BOARD.

       Section 975(b)(1) of this Act is amended by striking 
     subparagraph (B) and inserting the following:
       ``(B) by striking the second sentence and inserting the 
     following `The members of the Board shall serve as members 
     for a term of 3 years or for such other terms as specified by 
     rules of the Board pursuant to paragraph (2)(B), and shall 
     consist of (A) 8 independent individuals, at least 1 of whom 
     shall be representative of institutional or retail investors 
     in municipal securities, at least 1 of whom shall be 
     representative of municipal entities, and at least 1 of whom 
     shall be a member of the public with knowledge of or 
     experience in the municipal industry (which members are 
     hereinafter referred to as ``public representatives''); and 
     (B) 7 individuals who are associated with a broker, dealer, 
     municipal securities dealer, or municipal advisor, including 
     at least 1 individual who is associated with and 
     representative of brokers, dealers, or municipal securities 
     dealers that are not banks or subsidiaries or departments or 
     divisions of banks (which members are hereinafter referred to 
     as ``broker-dealer representatives''), at least 1 individual 
     who is associated with and representative of municipal 
     securities dealers which are banks or subsidiaries or 
     departments or divisions of banks (which members are 
     hereinafter referred to as ``bank representatives''), and at 
     least 1 individual who is associated with a municipal advisor 
     (which member is hereinafter referred to as the ``advisor 
     representative'').' ''.
                                 ______
                                 
  SA 3855. Mr. REED submitted an amendment intended to be proposed to 
amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mrs. Lincoln)) to the bill S. 3217, to promote the financial stability 
of the United States by improving accountability and transparency in 
the financial system, to end ``too big to fail'', to protect the 
American taxpayer by ending bailouts, to protect consumers from abusive 
financial services practices, and for other purposes; which was ordered 
to lie on the table; as follows:

       On page 1055, after line 22, add the following:
       (c) Liability for Sale of Securities.--Section 12 of the 
     Securities Act of 1933 (15 U.S.C. 77l) is amended--
       (1) in subsection (a)(2)--
       (A) by inserting after ``subsection (a) thereof'' the 
     following: ``, and whether or not exempted by the provisions 
     of section 4''; and
       (B) by inserting after ``prospectus'' the following: ``, 
     other offering document,''; and
       (2) in subsection (b), by inserting after ``prospectus'' 
     the following: ``, other offering document,''.
                                 ______
                                 
  SA 3856. Mr. REED submitted an amendment intended to be proposed to 
amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mrs. Lincoln)) to the bill S. 3217, to promote the financial stability 
of the United States by improving accountability and transparency in 
the financial system, to end ``too big to fail'', to protect the 
American taxpayer by ending bailouts, to protect consumers from abusive 
financial services practices, and for other purposes; which was ordered 
to lie on the table; as follows:

       On page 1055, after line 22, add the following:
       (c) Authority to Impose Conditions on the Availability of 
     Certain Exemptions.--
       (1) Authority established.--Section 4 of the Securities Act 
     of 1933 (15 U.S.C. 77d) is amended--
       (A) by striking ``The provisions of section 5'' and 
     inserting the following:
       ``(a) In General.--The provisions of section 5''; and
       (B) by adding at the end the following:
       ``(b) Authority to Impose Conditions.--The Commission may, 
     by rules and regulations, condition the availability of any 
     of the exemptions under subsection (a) on such disclosure, 
     filing, or other requirements as the Commission may prescribe 
     as necessary or appropriate in the public interest or for the 
     protection of investors.''.
       (2) Conforming amendments.--
       (A) Securities act of 1933.--The Securities Act of 1933 (15 
     U.S.C. 77a et seq.) is amended--
       (i) in section 16(a)(3) (15 U.S.C. 77p(a)(3)) is amended by 
     striking ``section 4(2)'' and inserting ``section 4(a)(2)''; 
     and
       (ii) in section 18(b)(4) (15 U.S.C. 77r(b)(4))--

       (I) in subparagraph (A), by striking ``section 4'' and 
     inserting ``section 4(a)'';
       (II) in subparagraph (B), by striking ``section 4(4)'' and 
     inserting ``section 4(a)(4)''; and
       (III) in subparagraph (D), by striking ``section 4(2)'' 
     each place that term appears and inserting ``section 
     4(a)(2)''.

       (B) Securities exchange act of 1934.--The Securities 
     Exchange Act of 1934 (15 U.S.C. 78a et seq.) is amended--
       (i) in section 15A(j) (15 U.S.C. 78o-3(j)), by striking 
     ``4(2), or 4(6)'' and inserting ``4(a)(2), or 4(a)(6)''; and
       (ii) in section 28(f)(5)(E) (15 U.S.C. 778bb(f)) by 
     striking ``section 4(2)'' and inserting ``section 4(a)(2)''.
       (C) Revised statutes.--Section 5136 of the Revised Statutes 
     (12 U.S.C. 24) is amended, in the seventh paragraph, by 
     striking ``section 4(5) of the Securities Act of 1933 (15 
     U.S.C. 77d(5))'' and inserting ``section 4(a)(5) of the 
     Securities Act of 1933''.
       (D) Home owners' loan act.--Section 5(c)(1)(R)(i) of the 
     Home Owners' Loan Act (12 U.S.C. 1464(c)(1)(R)(i)) by 
     striking ``section 4(5)'' and inserting ``section 4(a)(5)''.
       (E) Federal credit union act.--Section 107(15)(A) of the 
     Federal Credit Union Act (12 U.S.C. 1757(15)(A)) is amended 
     by striking ``section 4(5) of the Securities Act of 1933 (15 
     U.S.C. 77d(5))'' and inserting ``section 4(a)(5) of the 
     Securities Act of 1933''.
       (F) Secondary mortgage market enhancement act of 1984.--
     Section 106(a)(1) of the Secondary Mortgage Market 
     Enhancement Act of 1984 (15 U.S.C. 77r-1(a)(1)) is amended by 
     striking ``section 4(5)'' each place that term appears and 
     inserting ``section 4(a)(5)''.
                                 ______
                                 
  SA 3857. Mr. REED submitted an amendment intended to be proposed to 
amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mrs. Lincoln)) to the bill S. 3217, to promote the financial stability 
of the United States by improving accountability and transparency in 
the financial system, to end ``too big to fail'', to protect the 
American taxpayer by ending bailouts, to protect consumers from abusive 
financial services practices, and for other purposes; which was ordered 
to lie on the table; as follows:

       Page 1268, strike line 24 and all that follows through page 
     1270, line 10, and insert the following:
       (c) Examinations.--
       (1) In general.--The prudential regulator shall, on a 
     periodic basis, examine, or require reports from, each 
     institution referred to in subsection (a) for purposes of 
     ensuring and enforcing compliance with the requirements of 
     Federal consumer financial law.
       (2) Bureau role in supervision.--
       (A) Agency responsibilities.--The prudential regulator 
     shall provide all reports, records, and documentation related 
     to the examination process to the Bureau on a timely and 
     ongoing basis.
       (B) Bureau involvement.--The Bureau may, at its discretion, 
     include an examiner on any examination conducted under 
     paragraph (1). The prudential regulator shall involve such 
     Bureau examiner in the entire examination process, including 
     setting the scope of an examination, participating in the 
     examination, and providing input on the examination report, 
     matters requiring attention and examination ratings.
       (d) Enforcement.--
       (1) In general.--Notwithstanding any other provision of 
     this title, the prudential regulator shall have primary 
     authority to enforce compliance with any Federal consumer 
     financial law by institutions referred to in subsection (a) 
     of any of the consumer financial laws.
       (2) Coordination with prudential regulator.--
       (A) Referral.--
       (i) In general.--When the Bureau has reason to believe that 
     an institution described in subsection (a) has engaged in a 
     material violation of a Federal consumer financial law, the 
     Bureau may recommend in writing to the appropriate agency 
     that the appropriate agency initiate an enforcement 
     proceeding to the extent the appropriate agency is authorized 
     by that Federal law or by this title.
       (ii) Explanation.--Any recommendation under clause (i) 
     shall be accompanied by a written explanation of the concerns 
     giving rise to the recommendation.
       (B) Backstop enforcement authority of the bureau.--If the 
     appropriate agency does not, before the end of the 120-day 
     period beginning on the date on which the appropriate agency 
     receives a recommendation under subparagraph (A), initiate an 
     enforcement proceeding, the Bureau may initiate an 
     enforcement proceeding as permitted by Federal law.
                                 ______
                                 
  SA 3858. Mr. REED (for himself and Mr. Akaka) submitted an amendment 
intended to be proposed to amendment SA 3739 proposed by Mr. Reid (for 
Mr. Dodd (for himself and Mrs. Lincoln)) to the bill S. 3217, to 
promote the financial stability of the United States by improving 
accountability and transparency in the financial system, to end ``too 
big to fail'', to protect the American taxpayer by ending bailouts, to 
protect consumers from abusive financial services practices, and for 
other purposes; which was ordered to lie on the table; as follows:

       On page 1243, strike line 15, and all that follows through 
     page 1248, line 18.
                                 ______
                                 
  SA 3859. Mr. REED submitted an amendment intended to be proposed by 
him to the bill S. 3217, to promote the

[[Page S3279]]

financial stability of the United States by improving accountability 
and transparency in the financial system, to end ``too big to fail'', 
to protect the American taxpayer by ending bailouts, to protect 
consumers from abusive financial services practices, and for other 
purposes; which was ordered to lie on the table; as follows:

       Strike section 1044 and insert the following:

     SEC. 1044. STATE LAW PREEMPTION STANDARDS FOR NATIONAL BANKS 
                   AND SUBSIDIARIES CLARIFIED.

       (a) In General.--Chapter One of title LXII of the Revised 
     Statutes of the United States (12 U.S.C. 21 et seq.) is 
     amended by inserting after section 5136B the following new 
     section:

     ``SEC. 5136C. STATE LAW PREEMPTION STANDARDS FOR NATIONAL 
                   BANKS AND SUBSIDIARIES CLARIFIED.

       ``(a) Definitions.--For purposes of this section--
       ``(1) the term `national bank' includes--
       ``(A) any bank organized under the laws of the United 
     States;
       ``(B) any affiliate of a national bank;
       ``(C) any subsidiary of a national bank; and
       ``(D) any Federal branch established in accordance with the 
     International Banking Act of 1978;
       ``(2) the terms `affiliate', `subsidiary', `includes', and 
     `including' have the same meanings as in section 3 of the 
     Federal Deposit Insurance Act; and
       ``(3) the term `State consumer law' means any law of a 
     State that regulates the manner, content, or terms and 
     conditions of any financial transaction (as may be authorized 
     for national banks to engage in), or any account related 
     thereto, with respect to a consumer.
       ``(b) State Consumer Laws of General Application.--Except 
     as provided in subsection (c), and notwithstanding any other 
     provision of Federal law, any consumer protection provision 
     of a State consumer law of general application, shall apply 
     to a national bank operating within the jurisdiction of that 
     State, including any law relating to--
       ``(1) unfair or deceptive acts or practices;
       ``(2) consumer fraud; and
       ``(3) repossession, foreclosure, and debt collections.
       ``(c) Exceptions.--
       ``(1) In general.--Subsection (b) shall not apply with 
     respect to any State consumer law, if--
       ``(A) the State consumer law discriminates against national 
     banks; or
       ``(B) the State consumer law is inconsistent with 
     provisions of Federal law, other than this title, but only to 
     the extent of the inconsistency (as determined in accordance 
     with the provision of the other Federal law).
       ``(2) Rule of construction.--For purposes of paragraph (1), 
     a State consumer law is not inconsistent with Federal law, if 
     the protection that the State consumer law affords consumers 
     is greater than the protection provided under Federal law, as 
     determined by the Bureau of Consumer Financial Protection.
       ``(d) State Banking Laws Enacted Pursuant to Federal Law.--
       ``(1) In general.--Except as provided in paragraph (2), and 
     notwithstanding any other provision of Federal law, any State 
     consumer law shall apply to a national bank operating within 
     the jurisdiction of that State, if such State consumer law--
       ``(A) is applicable to State banks; and
       ``(B) was enacted pursuant to or in accordance with, and is 
     not inconsistent with, an Act of Congress, including the 
     Gramm-Leach-Bliley Act, the Consumer Credit Protection Act, 
     and the Real Estate Settlement Procedures Act of 1974, that 
     explicitly or by implication, permits States to exceed or 
     supplement the requirements of any comparable Federal law.
       ``(2) Exceptions.--
       ``(A) In general.--Paragraph (1) shall not apply with 
     respect to any State law, if--
       ``(i) the State consumer law discriminates against national 
     banks; or
       ``(ii) the State consumer law is inconsistent with 
     provisions of Federal law, other than this title, but only to 
     the extent of the inconsistency (as determined in accordance 
     with the provision of the other Federal law).
       ``(B) Rule of construction.--For purposes of subparagraph 
     (A), a State consumer law is not inconsistent with Federal 
     law, if the protection that the State consumer law affords 
     consumers is greater than the protection provided under 
     Federal law, as determined Bureau of Consumer Financial 
     Protection.
       ``(e) No Negative Implications for Applicability of Other 
     State Laws.--No provision of this section shall be construed 
     as altering or affecting the applicability to national banks 
     of any State law which is not described in this section.
       ``(f) Effect of Transfer of Transaction.--State consumer 
     law applicable to a transaction at the inception of the 
     transaction may not be preempted under Federal law solely 
     because a national bank subsequently acquires the asset or 
     instrument that is the subject of the transaction.
       ``(g) Denial of Preemption Not a Deprivation of a Civil 
     Right.--The preemption of any provision of the law of any 
     State with respect to any national bank shall not be treated 
     as a right, privilege, or immunity for purposes of section 
     1979 of the Revised Statutes of the United States (42 U.S.C. 
     1983).''.
       (b) Clerical Amendment.--The table of sections for chapter 
     one of title LXII of the Revised Statutes of the United 
     States is amended by inserting after the item relating to 
     section 5136B the following new item:

``5136C. State law preemption standards for national banks and 
              subsidiaries clarified.''.

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