[Congressional Record Volume 165, Number 80 (Tuesday, May 14, 2019)]
[House]
[Pages H3764-H3767]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
KLEPTOCRACY ASSET RECOVERY REWARDS ACT
Ms. WATERS. Mr. Speaker, I move to suspend the rules and pass the
bill (H.R. 389) to authorize the Secretary of the Treasury to pay
rewards under an asset recovery rewards program to help identify and
recover stolen assets linked to foreign government corruption and the
proceeds of such corruption hidden behind complex financial structures
in the United States and abroad, as amended.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 389
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
The Act may be cited as the ``Kleptocracy Asset Recovery
Rewards Act''.
SEC. 2. FINDINGS; SENSE OF CONGRESS.
(a) Findings.--Congress finds the following:
(1) The Stolen Asset Recovery Initiative (StAR), a World
Bank and United Nations anti-money-laundering effort,
estimates that between $20 billion to $40 billion has been
lost to developing countries annually through corruption.
(2) In 2014, more than $480 million in corruption proceeds
hidden in bank accounts around the world by former Nigerian
dictator Sani Abacha and his co-conspirators was forfeited
through efforts by the Department of Justice.
(3) In 2010, the Department of Justice established the
Kleptocracy Asset Recovery Initiative, to work in partnership
with Federal law enforcement agencies to forfeit the proceeds
of foreign official corruption and, where appropriate, return
those proceeds to benefit the people harmed by these acts of
corruption and abuse of office.
(4) Of the $20 billion to $40 billion lost by developing
countries annually through corruption, only about $5 billion
has been repatriated in the last 15 years.
(5) Governments weakened by corruption and loss of assets
due to corruption have
[[Page H3765]]
fewer resources to devote to the fight against terrorism and
fewer resources to devote to building strong financial, law
enforcement, and judicial institutions to aid in the fight
against the financing of terrorism.
(6) The United States has a number of effective programs to
reward individuals who provide valuable information that
assist in the identification, arrest, and conviction of
criminal actors and their associates, as well as seizure and
forfeiture of illicitly derived assets and the proceeds of
criminal activity.
(7) The Internal Revenue Service has the Whistleblower
Program, which pays awards to individuals who provide
specific and credible information to the IRS if the
information results in the collection of taxes, penalties,
interest or other amounts from noncompliant taxpayers.
(8) The Department of State administers rewards programs on
international terrorism, illegal narcotics, and transnational
organized crime with the goal of bringing perpetrators to
justice.
(9) None of these existing rewards programs specifically
provide monetary incentives for identifying and recovering
stolen assets linked solely to foreign government corruption,
as opposed to criminal prosecutions or civil or criminal
forfeitures.
(10) The recovery of stolen assets linked to foreign
government corruption and the proceeds of such corruption may
not always involve a BSA violation or lead to a forfeiture
action. In such cases there would be no ability to pay
rewards under existing Treasury Department authorities.
(11) Foreign government corruption can take many forms but
typically entails government officials stealing,
misappropriating, or illegally diverting assets and funds
from their own government treasuries to enrich their personal
wealth directly through embezzlement or bribes to allow
government resources to be expended in ways that are not
transparent and may not either be necessary or be the result
of open competition. Corruption also includes situations
where public officials take bribes to allow government
resources to be expended in ways which are not transparent
and may not be necessary or the result of open competition.
These corrupt officials often use the United States and
international financial system to hide their stolen assets
and the proceeds of corruption.
(12) The individuals who come forward to expose foreign
governmental corruption and kleptocracy often do so at great
risk to their own safety and that of their immediate family
members and face retaliation from persons who exercise
foreign political or governmental power. Monetary rewards can
provide a necessary incentive to expose such corruption and
provide a financial means to provide for their well-being and
avoid retribution.
(b) Sense of Congress.--It is the sense of Congress that a
Department of the Treasury stolen asset recovery rewards
program to help identify and recover stolen assets linked to
foreign government corruption and the proceeds of such
corruption hidden behind complex financial structures is
needed in order to--
(1) intensify the global fight against corruption; and
(2) serve United States efforts to identify and recover
such stolen assets, forfeit proceeds of such corruption, and,
where appropriate and feasible, return the stolen assets or
proceeds thereof to the country harmed by the acts of
corruption.
SEC. 3. IN GENERAL.
(a) Department of the Treasury Kleptocracy Asset Recovery
Rewards Program.--Chapter 97 of title 31, United States Code,
is amended by adding at the end the following:
``Sec. 9706. Department of the Treasury Kleptocracy Asset
Recovery Rewards Program
``(a) Establishment.--
``(1) In general.--There is established in the Department
of the Treasury a program to be known as the `Kleptocracy
Asset Recovery Rewards Program' for the payment of rewards to
carry out the purposes of this section.
``(2) Purpose.--The rewards program shall be designed to
support U.S. Government programs and investigations aimed at
restraining, seizing, forfeiting, or repatriating stolen
assets linked to foreign government corruption and the
proceeds of such corruption.
``(3) Implementation.--The rewards program shall be
administered by, and at the sole discretion of, the Secretary
of the Treasury, in consultation, as appropriate, with the
Secretary of State, the Attorney General, and the heads of
such other departments and agencies as the Secretary may find
appropriate.
``(b) Rewards Authorized.--In the sole discretion of the
Secretary and in consultation, as appropriate, with the heads
of other relevant Federal departments or agencies, the
Secretary may pay a reward to any individual, or to any
nonprofit humanitarian organization designated by such
individual, if that individual furnishes information leading
to--
``(1) the restraining or seizure of stolen assets in an
account at a U.S. financial institution (including a U.S.
branch of a foreign financial institution), that come within
the United States, or that come within the possession or
control of any United States person;
``(2) the forfeiture of stolen assets in an account at a
U.S. financial institution (including a U.S. branch of a
foreign financial institution), that come within the United
States, or that come within the possession or control of any
United States person; or
``(3) where appropriate, the repatriation of stolen assets
in an account at a U.S. financial institution (including a
U.S. branch of a foreign financial institution), that come
within the United States, or that come within the possession
or control of any United States person.
``(c) Coordination.--
``(1) Procedures.--To ensure that the payment of rewards
pursuant to this section does not duplicate or interfere with
any other payment authorized by the Department of Justice or
other Federal law enforcement agencies for the obtaining of
information or other evidence, the Secretary of the Treasury,
in consultation with the Secretary of State, the Attorney
General, and the heads of such other agencies as the
Secretary may find appropriate, shall establish procedures
for the offering, administration, and payment of rewards
under this section, including procedures for--
``(A) identifying actions with respect to which rewards
will be offered;
``(B) the receipt and analysis of data; and
``(C) the payment of rewards and approval of such payments.
``(2) Prior approval of the attorney general required.--
Before making a reward under this section in a matter over
which there is Federal criminal jurisdiction, the Secretary
of the Treasury shall obtain the written concurrence of the
Attorney General.
``(d) Payment of Rewards.--
``(1) Authorization of appropriations.--For the purpose of
paying rewards pursuant to this section, there is authorized
to be appropriated--
``(A) $450,000 for fiscal year 2020; and
``(B) for each fiscal year, any amount recovered in stolen
assets described under subsection (b) that the Secretary
determines is necessary to carry out this program consistent
with this section.
``(2) Limitation on annual payments.--Except as provided
under paragraph (3), the total amount of rewards paid
pursuant to this section may not exceed $25,000,000 in any
calendar year.
``(3) Presidential authority.--The President may waive the
limitation under paragraph (2) with respect to a calendar
year if the President provides written notice of such waiver
to the appropriate committees of the Congress at least 30
days before any payment in excess of such limitation is made
pursuant to this section.
``(4) Payments to be made first from stolen asset
amounts.--In paying any reward under this section, the
Secretary shall, to the extent possible, make such reward
payment--
``(A) first, from appropriated funds authorized under
paragraph (1)(B); and
``(B) second, from appropriated funds authorized under
paragraph (1)(A).
``(e) Limitations.--
``(1) Submission of information.--No award may be made
under this section based on information submitted to the
Secretary unless such information is submitted under penalty
of perjury.
``(2) Maximum amount.--No reward paid under this section
may exceed $5,000,000, unless the Secretary--
``(A) personally authorizes such greater amount in writing;
``(B) determines that offer or payment of a reward of a
greater amount is necessary due to the exceptional nature of
the case; and
``(C) notifies the appropriate committees of the Congress
of such determination.
``(3) Approval.--
``(A) In general.--No reward amount may be paid under this
section without the written approval of the Secretary.
``(B) Delegation.--The Secretary may not delegate the
approval required under subparagraph (A) to anyone other than
an Under Secretary of the Department of the Treasury.
``(4) Protection measures.--If the Secretary determines
that the identity of the recipient of a reward or of the
members of the recipient's immediate family must be
protected, the Secretary shall take such measures in
connection with the payment of the reward as the Secretary
considers necessary to effect such protection.
``(5) Forms of reward payment.--The Secretary may make a
reward under this section in the form of a monetary payment.
``(f) Ineligibility, Reduction in, or Denial of Reward.--
``(1) Officer and employees.--An officer or employee of any
entity of Federal, State, or local government or of a foreign
government who, while in the performance of official duties,
furnishes information described under subsection (b) shall
not be eligible for a reward under this section.
``(2) Participating individuals.--If the claim for a reward
is brought by an individual who the Secretary has a
reasonable basis to believe knowingly planned, initiated,
directly participated in, or facilitated the actions that led
to assets of a foreign state or governmental entity being
stolen, misappropriated, or illegally diverted or to the
payment of bribes or other foreign governmental corruption,
the Secretary shall appropriately reduce, and may deny, such
award. If such individual is convicted of criminal conduct
arising from the role described in the preceding sentence,
the Secretary shall deny or may seek to recover any reward,
as the case may be.
``(g) Report.--
[[Page H3766]]
``(1) In general.--Within 180 days of the enactment of this
section, and annually thereafter for 5 years, the Secretary
shall issue a report to the appropriate committees of the
Congress--
``(A) detailing to the greatest extent possible the amount,
location, and ownership or beneficial ownership of any stolen
assets that, on or after the date of the enactment of this
section, come within the United States or that come within
the possession or control of any United States person;
``(B) discussing efforts being undertaken to identify more
such stolen assets and their owners or beneficial owners; and
``(C) including a discussion of the interactions of the
Department of the Treasury with the international financial
institutions (as defined in section 1701(c)(2) of the
International Financial Institutions Act) to identify the
amount, location, and ownership, or beneficial ownership, of
stolen assets held in financial institutions outside the
United States.
``(2) Exception for ongoing investigations.--The report
issued under paragraph (1) shall not include information
related to ongoing investigations.
``(h) Definitions.--For purposes of this section:
``(1) Appropriate committees of the congress.--The term
`appropriate committees of the Congress' means the Committee
on Financial Services of the House of Representatives and the
Committee on Banking, Housing, and Urban Affairs of the
Senate.
``(2) Financial asset.--The term `financial asset' means
any funds, investments, or ownership interests, as defined by
the Secretary, that on or after the date of the enactment of
this section come within the United States or that come
within the possession or control of any United States person.
``(3) Foreign government corruption.--The term `foreign
government corruption' includes bribery of a foreign public
official, or the misappropriation, theft, or embezzlement of
public funds or property by or for the benefit of a foreign
public official.
``(4) Foreign public official.--The term `foreign public
official' includes any person who occupies a public office by
virtue of having been elected, appointed, or employed,
including any military, civilian, special, honorary,
temporary, or uncompensated official.
``(5) Immediate family member.--The term `immediate family
member', with respect to an individual, has the meaning given
the term `member of the immediate family' under section 36(k)
of the State Department Basic Authorities Act of 1956 (22
U.S.C. 2708(k)).
``(6) Rewards program.--The term `rewards program' means
the program established in subsection (a)(1) of this section.
``(7) Secretary.--The term `Secretary' means the Secretary
of the Treasury.
``(8) Stolen assets.--The term `stolen assets' means
financial assets within the jurisdiction of the United
States, constituting, derived from, or traceable to, any
proceeds obtained directly or indirectly from foreign
government corruption.''.
(b) Report on Disposition of Recovered Assets.--Within 360
days of the enactment of this Act, the Secretary of the
Treasury shall issue a report to the appropriate committees
of Congress (as defined under section 9706(h) of title 31,
United States Code) describing policy choices and
recommendations for disposition of stolen assets recovered
pursuant to section 9706 of title 31, United States Code.
(c) Table of Contents Amendment.--The table of contents for
chapter 97 of title 31, United States Code, is amended by
adding at the end the following:
``9706. Department of the Treasury Kleptocracy Asset Recovery Rewards
Program.''.
The SPEAKER pro tempore. Pursuant to the rule, the gentlewoman from
California (Ms. Waters) and the gentleman from Ohio (Mr. Stivers) each
will control 20 minutes.
The Chair recognizes the gentlewoman from California.
General Leave
Ms. WATERS. Mr. Speaker, I ask unanimous consent that all Members may
have 5 legislative days within which to revise and extend their remarks
on this legislation and to insert extraneous material thereon.
The SPEAKER pro tempore. Is there objection to the request of the
gentlewoman from California?
There was no objection.
Ms. WATERS. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, H.R. 389, the Kleptocracy Asset Recovery Rewards Act
offered by Representatives Lynch and Budd, will help the United States
Government identify and recover assets that corrupt foreign government
officials have stolen from their countries. The act does this through a
Treasury-based rewards program that incentivizes individuals to notify
the U.S. Government of the location of stolen assets that are linked to
foreign government corruption. These assets may be bank accounts as
well as luxury items, such as mansions, jewelry, jet planes, and
artwork.
Law enforcement already works hard to find these stolen assets. Since
2010, the United States has fought in courts to freeze, forfeit, and
ultimately recover more than $3.2 billion in assets linked to foreign
corruption to be returned to the victims of these financial crimes.
There are several recent examples of corrupt foreign funds making
their way to the United States. The multibillion-dollar 1MDB scandal
involving Goldman Sachs defrauded the people of Malaysia. To date, the
FBI has identified $1.7 billion of the proceeds of that crime, which
went to purchase a yacht, museum-quality paintings, and real estate. In
fact, the government returned $57 million of recovered stolen funds to
Malaysia following a settlement over the rights to the 2013 film, ``The
Wolf of Wall Street,'' which was financed using corrupt 1MDB funds.
Similarly, the United States helped to recover over $30 million from
the sale of real estate, a Ferrari, and rare music memorabilia, which
were purchased by Equatorial Guinea's President Obiang and his son with
corrupt funds.
H.R. 389 would direct the Treasury to pay whistleblowers rewards from
the recovered assets for helping to uncover assets like these.
Encouraging and incentivizing whistlblowers would strip the bad actors
of the ill-gotten gains and help victims and their countries recover
from the devastating effects of corruption.
So, Mr. Speaker, I want to thank Mr. Lynch and Mr. Budd for
introducing this bill to help the U.S. punish kleptocrats. For these
reasons, I urge my colleagues to support H.R. 389.
Mr. Speaker, I reserve the balance of my time.
Mr. STIVERS. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I rise in support of H.R. 389, the Kleptocracy Asset
Recovery Rewards Act, and I want to thank the gentleman from
Massachusetts (Mr. Lynch) as well as the gentleman from North Carolina
(Mr. Budd) for their hard work on this important piece of bipartisan
legislation.
H.R. 389 would authorize the Treasury Department to offer rewards for
information leading to the recovery of assets stolen through foreign
government corruption.
Mr. Speaker, in the past, the United States has focused on fighting
such corruption with traditional tools such as sanctions, technical
assistance, and oversight of international financial institutions, but
the bill gives Treasury an additional tool to expose corrupt foreign
officials.
I, again, would like to thank my colleagues across the aisle,
especially Chairwoman Waters, for her hard work on this bill and
allowing us to work together in a bipartisan fashion to refine this
legislation as it made its way to the floor.
One piece of the bill that has gotten better that I still think could
use an additional tweak is the bill does not allow anyone to receive a
payment if they are part of the corrupt activity, but it does not
require Treasury to fully investigate every potential claimant to make
sure that they are not. So while that has gotten better--there is
better language in the bill now--I think that, hopefully, this can
continue to be perfected as we move forward. I support the bill, but I
do think that provision could get better.
The minority did make several proposals to strengthen the bill, which
were accepted by the majority. I am grateful to the gentleman from
Massachusetts for partnering with us, as well as the gentleman from
North Carolina, and for their hard work on the bill.
Mr. Speaker, I look forward to voting for H.R. 389. I urge my
colleagues to support it, and I reserve the balance of my time.
(1715)
Ms. WATERS. Mr. Speaker, I yield such time as he may consume to the
gentleman from Massachusetts (Mr. Lynch), the sponsor of this
legislation and a member of the Financial Services Committee.
Mr. LYNCH. Mr. Speaker, I thank the gentlewoman for her leadership on
the committee and on this issue and for yielding me this time.
The opportunity that we have today here to present the Kleptocracy
Asset Recovery Rewards Act is a very important moment.
[[Page H3767]]
I also want to thank my colleagues, the gentleman from North Carolina
(Mr. Budd) and also the gentleman from Tennessee (Mr. Cohen), who have
also contributed hard work in developing and cosponsoring this
legislation.
Foreign dictators who rob the treasuries of developing nations, where
independent judiciaries are rare, and the rule of law is often weak, is
not a new problem; but, unfortunately, it is a growing problem.
It is now estimated that more than $1 trillion is lost to bribes and
official corruption around the world each year. A significant portion
of those illicit proceeds are used to support organized crime and
terrorist organizations, further destabilizing the social institutions
where this corruption occurs, often in developing countries who can
least afford it.
This undermines the local rule of law and contributes to the regional
insecurity and instabilities in neighboring countries.
Governments that are weakened by corruption have fewer resources to
provide basic services, to establish a stable business climate, and to
create jobs. They also have fewer resources to devote to building
strong law enforcement and judicial institutions to combat exploitation
by terrorists and criminal organizations.
It is a sad fact that today much of this stolen money ends up here,
in bank accounts right here in the United States.
H.R. 389 fights back against the spreading influence of this
corruption. The Kleptocracy Asset Recovery Rewards Act establishes a
rewards program to incentivize individuals to notify law enforcement
and authorities of assets stolen from foreign treasuries and illegally
transferred to the United States.
Now, I appreciate the gentleman's concerns about making sure that bad
actors don't participate in this incentive program.
This program replicates the incentives that have been utilized by the
United States Department of Justice and the FBI for decades to take
down criminal drug cartels with the help of paid informants.
While the United States has many effective programs to reward
individuals who provide valuable information toward curbing criminal
behavior, none of our programs currently have been designed to take aim
at recovering stolen assets linked to foreign government kleptocracy.
Kleptocracy by foreign leaders can drain the hope and faith of
struggling peoples around the globe who strive for social justice and
equal rights.
This bill recognizes that foreign corruption takes many forms and
that individuals who come forward to expose corruption often do so at
great personal peril to themselves and to their families.
So, as transnational criminal enterprises persist, and terrorists
adapt to the different mechanisms that we use, we must provide law
enforcement with fresh tools to address these emerging threats.
H.R. 389 does exactly that.
Mr. Speaker, I want to thank, again, the chairwoman for her
cooperation and leadership. I thank my colleagues on the other side,
especially Mr. Budd, for his work on this bill as well. I thank my
colleagues on both sides of the aisle for working with me on this
legislation.
Mr. Speaker, I urge a ``yes'' vote.
Mr. STIVERS. Mr. Speaker, H.R. 389 will give the Treasury an
additional tool to fight corrupt foreign governments. There has been a
lot of work done on this bill. It is a good bill. I urge my colleagues
to support it, and I yield back the balance of my time.
Ms. WATERS. Mr. Speaker, I yield myself the balance of my time.
Mr. Speaker, I am very pleased that Mr. Lynch and Mr. Budd have
presented this bipartisan bill to the House. We must not allow the
United States financial system to be a haven for stolen assets that
rightly belong to others.
By incentivizing individuals to come forward with information about
where these stolen assets are hidden, we ensure the financial security
of our system and can help send back recovered assets to where they
belong.
Mr. Speaker, I urge my colleagues to join me in supporting this
important piece of legislation, and I yield back the balance of my
time.
The SPEAKER pro tempore. The question is on the motion offered by the
gentlewoman from California (Ms. Waters) that the House suspend the
rules and pass the bill, H.R. 389, as amended.
The question was taken; and (two-thirds being in the affirmative) the
rules were suspended and the bill, as amended, was passed.
A motion to reconsider was laid on the table.
____________________