[Congressional Record Volume 170, Number 6 (Thursday, January 11, 2024)]
[House]
[Pages H71-H77]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                              {time}  1415
                STOP SETTLEMENT SLUSH FUNDS ACT OF 2023

  Mr. GOODEN of Texas. Mr. Speaker, pursuant to House Resolution 947, I 
call up the bill (H.R. 788) to limit donations made pursuant to 
settlement agreements to which the United States is a party, and for 
other purposes, and ask for its immediate consideration in the House.
  The Clerk read the title of the bill.
  The SPEAKER pro tempore (Mr. Newhouse). Pursuant to House Resolution 
947, in lieu of the amendment in the nature of a substitute recommended 
by the Committee on the Judiciary, printed in the bill, an amendment in 
the nature of a substitute consisting of the text of Rules Committee 
Print 118-18 is adopted, and the bill, as amended, is considered read.
  The text of the bill, as amended, is as follows:

                                H.R. 788

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Stop Settlement Slush Funds 
     Act of 2023''.

     SEC. 2. LIMITATION ON DONATIONS MADE PURSUANT TO SETTLEMENT 
                   AGREEMENTS TO WHICH THE UNITED STATES IS A 
                   PARTY.

       (a) Limitation on Required Donations.--An official or agent 
     of the Government may not enter into or enforce any 
     settlement agreement on behalf of the United States directing 
     or providing for a payment to any person or entity other than 
     the United States, other than a payment that provides 
     restitution for or otherwise directly remedies actual harm 
     (including to the environment) directly and proximately 
     caused by the party making the payment, or constitutes 
     payment for services rendered in connection with the case.
       (b) Penalty.--Any official or agent of the Government who 
     violates subsection (a) shall be subject to the same 
     penalties that would apply in the case of a violation of 
     section 3302 of title 31, United States Code.
       (c) Effective Date.--Subsections (a) and (b) apply only in 
     the case of a settlement agreement entered on or after the 
     date of enactment of this Act.
       (d) Definition.--The term ``settlement agreement'' means a 
     settlement agreement resolving a civil action or potential 
     civil action.
       (e) Reports on Settlement Agreements.--
       (1) In general.--Not later than at the end of the first 
     fiscal year that begins after the date of enactment of this 
     Act, and annually thereafter, the head of each Federal agency 
     shall submit electronically to the Congressional Budget 
     Office a report on each settlement agreement entered into by 
     that agency during that fiscal year that directs or provides 
     for a payment to a person or entity other than the United 
     States that is providing restitution for or otherwise 
     directly remedies actual harm (including to the environment) 
     directly and proximately caused by the party making the 
     payment, or that constitutes payment for services rendered in 
     connection with the case, which shall include the parties to 
     each settlement agreement, the source of the settlement 
     funds, and where and how such funds were and will be 
     distributed.
       (2) Prohibition on additional funding.--No additional funds 
     are authorized to be appropriated to carry out this 
     subsection.
       (3) Sunset.--This subsection shall cease to be effective on 
     the date that is 7 years after the date of enactment of this 
     Act.
       (f) Annual Audit Requirement.--
       (1) In general.--Not later than at the end of the first 
     fiscal year that begins after the date of enactment of this 
     Act, and annually thereafter, the Inspector General of each 
     Federal agency shall submit a report on any settlement 
     agreement entered into in violation of this section by that 
     agency to--
       (A) the Committee on the Judiciary, the Committee on the 
     Budget, and the Committee on Appropriations of the Senate; 
     and
       (B) the Committee on the Judiciary, the Committee on the 
     Budget, and the Committee on Appropriations of the House of 
     Representatives.
       (2) Prohibition on additional funding.--No additional funds 
     are authorized to be appropriated to carry out this 
     subsection.

  The SPEAKER pro tempore. The bill, as amended, shall be debatable for 
1 hour, equally divided and controlled by the chair and ranking 
minority member of the Committee on the Judiciary, or their respective 
designees.

[[Page H72]]

  After 1 hour of debate, it shall be in order to consider the 
amendment printed in House Report 118-342, if offered by the Member 
designated in the report, which shall be considered read, shall be 
separately debatable for the time specified in the report equally 
divided and controlled by the proponent and an opponent, and shall not 
be subject to a demand for a division of the question.
  The gentleman from Texas (Mr. Gooden), and the gentleman from New 
York (Mr. Nadler) each will control 30 minutes.
  The Chair recognizes the gentleman from Texas.


                             General Leave

  Mr. GOODEN of Texas. Mr. Speaker, I ask unanimous consent that all 
Members may have 5 legislative days in which to revise and extend their 
remarks and to insert extraneous material on H.R. 788.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Texas?
  There was no objection.
  Mr. GOODEN of Texas. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, today I rise in support of H.R. 788, the Stop Settlement 
Slush Funds Act. This legislation seeks to repair a loophole that has 
been exploited by the executive branch agencies to redirect funds from 
Federal law enforcement settlements to outside, nongovernment entities.
  Under this third-party settlement policy, agencies reach a settlement 
and include mandatory donation terms to externally divert these funds 
to third parties instead of either depositing them with the Treasury or 
exclusively using them to provide restitution to the victims.
  Instead of depositing these settlements with the Treasury or 
compensating the victims, which should be the only appropriate use of 
these funds, agencies give sizable chunks to third parties diluting the 
share of the victims and even cutting out the Treasury completely.
  Let me summarize this. Currently, when the Department of Justice 
reaches a settlement, oftentimes we don't know where it goes. More 
often than not, they give favorable terms to whoever they are settling 
with and say, if you divert XYZ dollars--in many cases millions--to a 
charity of our choosing, then we will call this quits, we will let you 
off, and you will get out of here.
  What is happening, though, is, one, the people don't know where these 
settlements are going; two, Congress has no oversight of where this 
money is going and how it is spent; and, three, executive branch is 
going around Congress and spending dollars without going through the 
appropriations process. That is wrong.
  Mr. Speaker, what you will hear from the other side today is that 
this is an essential tool. I would like to go back and forth and give 
you examples of failures of this policy, Mr. Speaker.
  To be fair, this is not just something that the Biden administration 
is guilty of. This has happened in prior Presidential administrations. 
Fortunately, under President Trump's administration, this policy was 
stopped temporarily. Unfortunately, Congress did not end it because it 
was stopped.
  What we should have done when President Trump was President is ended 
this policy then. Unfortunately, here we are. The Biden administration 
has reactivated it, and millions of dollars that could have gone to 
victims or could have gone to the U.S. Treasury for this Congress to 
then appropriate are now going to special groups, often liberal groups 
that are pet projects of this administration. It is my goal to end this 
policy once and for all. It is bad business for the American people, it 
is wrong, and it needs to be stopped no matter who the President is.
  Mr. Speaker, I reserve the balance of my time.
  Mr. NADLER. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise in opposition to H.R. 788, the so-called Stop 
Settlement Slush Funds Act of 2023.
  This harmful legislation would prevent the Justice Department from 
negotiating settlements to include payments to third parties, primarily 
nonprofits and community-based organizations, that are best positioned 
to remedy harms to society at large that were caused by a corporate 
wrongdoer's violation of Federal environmental, labor, consumer, and 
financial protections.
  This bill is nothing short of a gift to large corporations that would 
leave victims of their misconduct out in the cold.
  No credible facts justify H.R. 788. This bill is based on the false 
premise that the Justice Department uses these types of settlements as 
illegitimate favors for an administration's political allies, with the 
bill's supporters describing such settlements as politically motivated 
slush funds.
  This is an outlandish attack on a perfectly legal and constitutional 
type of remedy and is an argument that both the Government 
Accountability Office and the Congressional Research Service have 
thoroughly debunked.
  Yet, House Republicans have spent countless hours and taxpayer 
dollars over several Congresses, going back at least a decade, chasing 
the conspiracy theory that the Justice Department is attempting to fund 
liberal activist groups and causes through negotiated settlements.
  This included a multiyear investigation of the settlements that the 
Justice Department entered into with several big banks following the 
2008 financial crisis, banks whose greedy appetite for mortgage-backed 
securities led to predatory lending practices that ultimately left 
millions of homeowners facing foreclosure. The big banks turned a blind 
eye to these practices, while they packaged mortgages that they knew 
were of questionable value as securities and sold them to individual 
and institutional investors alike.
  Although the big banks' illegal conduct led directly to the 2008 
financial crisis, it was difficult, if not impossible, for individual 
borrowers or homeowners to hold them legally accountable for the harms 
they suffered from the bank's near implosion of the Nation's financial 
system.

  In response, roughly 1 percent--a tiny fraction--of the settlement 
monies in suits brought by the government ultimately went to third-
party organizations specializing in aiding private homeowners to obtain 
mortgage relief or other related community services--a perfectly 
reasonable way to help remedy the harm caused by these large financial 
institutions' irresponsible behavior.
  Unsurprisingly, the House Republican investigation into these 
settlements produced not one shred of credible evidence to support 
their allegations that this represented some sort of improper action--a 
common result when it comes to the majority's oversight priorities it 
seems.
  Nonetheless, the majority seeks to enact H.R. 788, a bill that 
purports to address a problem that does not exist while its proposed 
solution would create real negative consequences for the American 
public.
  Were Congress to pass H.R. 788, it would reward corporate lawbreakers 
and further victimize the families and communities suffering from the 
consequences of corporate misconduct, including injuries from civil 
rights violations, environmental justice harms, or harms caused by 
fraudulent lending practices.
  During the Rules Committee hearing earlier this week, my colleagues 
on the other side began to argue that these settlements are, in fact, a 
sweet deal for corporate lawbreakers at the expense of the taxpayer. 
Nothing could be further from reality.
  First, let us not lose sight of the fact that the majority of 
settlement funds go to the U.S. Treasury.
  Second, these settlements enable Federal agencies to efficiently 
resolve enforcement actions. In many of the kinds of cases from which 
these types of settlements arise, litigation is complex, expensive, and 
time consuming. It could take the government years to hold wrongdoers 
accountable if they are unable to reach a settlement.
  Justice delayed is justice denied. These settlements save the 
taxpayers millions of dollars in litigation costs, boosting the value 
of the settlements to the U.S. Treasury beyond the listed dollar 
figure, while at the same time providing more immediate relief for 
victims of corporate lawbreaking.
  H.R. 788 is simply a tired attempt by the majority to paint a 
constitutional veneer upon their unpopular antiregulatory agenda, which 
includes enacting legislation that will undermine critical financial, 
environmental,

[[Page H73]]

public health, and safety protections for the American public.
  This antiregulatory bill is a solution in search of a problem, 
designed to serve deep-pocketed corporate interests at the American 
people's expense.
  It is a shame that House Republicans have chosen this unjustified and 
harmful bill as one of their first measures to bring to the floor in 
this new year. We could have started the new year by considering 
bipartisan legislation to address a real problem. At the same markup 
where the Judiciary Committee considered this bill, we also considered 
legislation that would have addressed bipartisan concerns about Federal 
civil asset forfeiture laws. That bill passed the committee by a 26-0 
vote in favor, and I have no doubt we would have enjoyed strong 
bipartisan support on the floor.
  Be that as it may, here we are, once again, at the precipice of a 
possible government shutdown, and House Republicans have chosen instead 
to waste time on H.R. 788, recycling an unnecessary bill that has no 
chance of passage in the Senate at a time when the House should be 
working expeditiously to ensure that the government stays open.
  In short, rather than considering ill-conceived and harmful 
legislation, we ought to be devoting this first legislative week of the 
new year focused on serving the actual needs of the American people, 
which is the basic job that we were elected to do.
  Mr. Speaker, I urge my colleagues to vote ``no'' on H.R. 788, and I 
reserve the balance of my time.
  Mr. GOODEN of Texas. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, let me read this to you. This is from Bob LeClair, head 
of the Hawaii Legal Aid Foundation and executive director of the Hawaii 
Justice Foundation: ``I would be willing to have us build a statue [to 
Obama DOJ Associate Attorney General Tony West] and then we could bow 
down to this statue each day after we get our $200,000.''
  Now, what is that about?
  That is about one of these liberal groups getting money from the 
Justice Department in backroom settlements, and this is just one little 
quote that we found in an email that we were privy to, because at the 
end of the day, we don't even know about all these settlements.
  I want to show you all this. Let's assume that everything my 
colleague said was true about these settlements and how great they are. 
Let's just assume for a second that we all agree that all these groups 
that are getting settlements are good groups and that this is a worthy 
cause and a worthy use of settlement.
  Everything he just told you only relates to the 1.4 percent of where 
these settlements have gone because the rest of the 99 percent of 
settlement funds, we have no idea where they went. We don't even know 
what groups got them because the DOJ is making these backroom deals.
  One of the problems that I have with my friends across the aisle is 
saying that this is a gift to big business.
  Mr. Speaker, what they are going for is to preserve the status quo. 
The status quo is giving breaks to big businesses.
  Mr. Speaker, let me give you an example. Bank of America settled with 
the government in exchange for getting to walk away from these charges. 
They were allowed to pay some money to some of these liberal groups to 
help with banking needs, et cetera. If they are not forced to admit 
guilt and write a check to the U.S. Treasury and say we are guilty, 
then we are letting them get away. That is what Democrats want to do.

  Democrats want a corporate violator to be able to come forward and 
say, hey, I made this big donation to this great group, and don't tell 
anyone that we actually pled, and we didn't have to admit guilt.
  So the shreds of evidence are actually much greater than just shreds. 
We have so many instances of waste and corruption within this process, 
but, unfortunately, everything I am telling you and everything the 
gentleman is telling you only relates to 1.4 percent of it. We don't 
even know how bad the other 99 percent of it is.
  It is Congress' job to appropriate funds; it is the Department of 
Justice's job to carry out justice, and that is that.
  Mr. Speaker, I yield 3 minutes to the gentlewoman from Wyoming (Ms. 
Hageman).
  Ms. HAGEMAN. Mr. Speaker, it should come as no surprise that this 
administration, known for its reckless spending and misuse of 
congressionally appropriated money, has resumed the Obama-era practice 
of redirecting settlement funds away from the American people and to 
activist groups championing the radical left's projects.

                              {time}  1430

  Instead of going to those harmed by a defendant or placing such funds 
into the U.S. Treasury to serve the American people, vast sums of 
money, literally millions and tens of millions of dollars, are instead 
being directed to Democratic Party-aligned groups by Federal agencies, 
placing these newly acquired Federal funds outside of Congress' purview 
while also funding radical progressive agendas to boot.
  These groups are then free to spend dollars on partisan priorities 
expressly denied by Congress or to fund their own sue-and-settle 
tactics against the Federal Government.
  Simply put, these funds are weaponized against the American people 
and are yet another way Democrats are abusing their power. Twice, the 
Trump administration limited this practice, only to have each attempt 
reversed by Joe Biden.
  Clearly, this is not a partisan abuse. It is coming from only one 
side. As a Member of Congress, such actions are a blatant affront to 
our power of the purse and an effort to sidestep congressional 
oversight.
  These slush fund activities deprive victims of the proper restitution 
our justice system promises.
  H.R. 788 will end this unconstitutional, fraudulent, and immoral 
practice and provide Americans greater transparency in Federal 
settlement practices.
  Mr. Speaker, I urge my colleagues to vote in favor of this bill.
  Mr. NADLER. Mr. Speaker, the gentleman from Texas and the gentlewoman 
from Wyoming are simply wrong as they describe the situation.
  In all of these settlements, the Federal Government is given money, 
the bulk of the money. It doesn't go to a third-party group. A small 
fraction then goes to a small group to help make the victims of the 
fraud or the malfeasance somewhat whole, but the Federal Government 
gets the bulk of the funds in the first place.
  It is a two-part payout. The Federal Government gets most of the 
funds, and then a third party helps some of the victims get a little 
part of the funds.
  Mr. Speaker, I yield 3 minutes to the gentlewoman from North Carolina 
(Mrs. Foushee).
  Mrs. FOUSHEE. Mr. Speaker, I rise to oppose this bill that undermines 
our ability to hold corporate wrongdoers accountable for unlawful 
conduct. This bill will prevent Federal agencies from entering into 
settlements that set aside funds for third parties, such as legal aid, 
housing, or financial counseling groups, or community assistance, 
settlements that provide some relief for victims of corporate 
misconduct.
  For this reason, at the appropriate time, I will offer a motion to 
recommit this bill back to committee. If the House rules permitted, I 
would have offered the motion with an important amendment to this bill. 
My amendment would have provided for exceptions in the case that a 
settlement agreement pertains to the abuse of opioids, and that 
includes allegations of false claims against the United States related 
to a healthcare benefit program.
  Mr. Speaker, I hope my colleagues join me in voting for this motion 
to recommit.
  Mr. Speaker, I ask unanimous consent to insert the text of this 
amendment into the Record immediately prior to the motion to recommit.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentlewoman from North Carolina?
  There was no objection.
  Mr. GOODEN of Texas. Mr. Speaker, I yield 3 minutes to the gentleman 
from Texas (Mr. Moran).
  Mr. MORAN. Mr. Speaker, I rise today in support of H.R. 788, the Stop 
Settlement Slush Funds Act of 2023.
  This act is one step in the reform process to return spending power 
back

[[Page H74]]

to the hands of Congress and ensure the proper use of every dollar that 
comes into the Treasury.
  This bill would help to ensure the damages owed to victims of 
wrongdoing actually reach them rather than being used to support 
organizations that are friends of the executive branch, regardless of 
the party.
  For those who don't know, settlement slush funds result when 
defendants settle with government agencies and, based on the terms of 
that settlement, direct the settlement proceeds to politically favored 
third parties instead of victims or the U.S. Treasury for use in 
correcting the actual wrongdoing.
  In these cases, the victims often have little to no say in how the 
settlement will be structured and certainly have no redress when the 
government directs these monetary settlements elsewhere.
  In the past, these types of settlements have been used to support the 
pet projects of prior administrations or the friends of prior 
administrations, and this is simply unacceptable.
  Settlement funds should go to the victims and to remedy the actual 
harm created by these wrongdoers, not to help and support friends of 
the current administration--again, regardless of which party is in 
power.
  Reform is needed to end this practice, and Congress should enact H.R. 
788, the Stop Settlement Slush Funds Act of 2023, immediately because 
not only do we see that these funds are redirected in inappropriate 
ways but these settlements amount to a form of executive branch 
spending that has not been approved or even reviewed by Congress.
  Accordingly, these settlement slush funds undermine congressional 
oversight, agency accountability, and the power of the purse. The 
responsibility of the power of the purse falls solely on Congress, and 
we should have the authority to direct the funding of these settlement 
agreements, not the executive branch's special interests.
  Moreover, money from settlements with companies and individuals 
should benefit the harmed and remedy the underlying actual wrongdoing. 
Those funds should not be redirected to nonprofits supporting the 
political agendas of the administration.
  Let's stop this practice today. We can do it if we pass this bill. 
Let us pass the Stop Settlement Slush Funds Act of 2023.
  Mr. NADLER. Mr. Speaker, I yield 3 minutes to the distinguished 
gentlewoman from Texas (Ms. Jackson Lee).
  Ms. JACKSON LEE. Mr. Speaker, I thank the ranking member of the full 
committee and the manager of this presentation on the floor for dealing 
with H.R. 788.
  Mr. Speaker, I rise to save lives. This baffles me when good work is 
being done and has been done over the years. No one has complained 
about misconduct of the recipients of the settlement funds helping 
people who have been impacted negatively, sometimes with irreparable 
harm. They are assisted by a number of organizations making a 
difference.
  Rather, we want to go forward with the corporate unaccountability 
act, making this an unreasonable attempt and unconstitutional attempt 
by Members on the other side to stop protecting victims and protect 
wrongdoers, which is a continuation of the dangerous behavior that has 
brought about this settlement.
  What do Americans look to their Federal Government for? They look to 
the government to be their rock, their anchor in times of natural 
disasters, man-made and otherwise. They look to their government in 
times of war and peace for us to defend this Nation. They certainly 
look to make sure that in the normal comings and goings of their work 
with their families, their communities, that someone is looking out for 
them. That is what the settlement opportunities give to our various 
agencies.
  This would allow the continued work, rather than the taking away of 
these dollars from legitimate groups that are helping to make life 
better. This weakens the Federal Government's ability to settle these 
issues. It takes away the idea of legal aid and legal aid organizations 
being able to help individuals without access to legal assistance. It 
helps develop community banking, financial institutions. It gives 
housing opportunities to those who have been taken advantage of.
  We know that we are in a condition of toxic air and toxic 
contamination in our neighborhoods, and what does the ability to settle 
the disaster that has been created do? It tells those offenders this is 
how they make the community whole. This is how they save lives.
  I know it well in Fifth Ward, Texas, and the surrounding areas. For a 
long time, a corporate offender contaminated the soil. They were 
growing plants and flowers, so whole neighborhoods had an epidemic of 
cancer. There were whole generations that lived around this particular 
toxic site, but it was only the Federal Government--the EPA, in 
particular--under the Biden administration that came in and got a 
handle on this and insisted that the health needs of these individuals, 
the cleanup needs of these individuals, was going to be taken care of.
  The SPEAKER pro tempore. The time of the gentlewoman has expired.
  Mr. NADLER. Mr. Speaker, I yield an additional 1 minute to the 
gentlewoman from Texas.
  Ms. JACKSON LEE. Mr. Speaker, I thank the gentleman from New York, 
the ranking member, for yielding additional time.
  This is not that s-word. I don't even want to say it because it means 
that it is something wrong. This is a good settlement opportunity that 
will help the public in fighting against bad actors. It will work on 
improving the criminal justice system, bankruptcies, the environment, 
civil rights laws, the Fair Housing Act, and the Servicemembers Civil 
Relief Act.
  This is a pathway to disaster. That is what H.R. 788 is. Don't be 
fooled, Mr. Speaker. What we want to do is help the American people and 
eliminate H.R. 788, which is going to take away the tools to be able to 
help them.
  Mr. Speaker, I started out by saying we want to save lives, and that 
is what we want to continue to do in these dastardly conditions that 
have happened all over the Nation. We want the Federal Government to be 
standing next to Americans and to be able to help them.
  Mr. Speaker, I include in the Record a letter from several 
organizations that oppose H.R. 788.
                                                  January 8, 2024.
     Re Oppose H.R. 788--The Prevention of Community Restoration 
         Act.

       Dear Representative: We urge you to oppose H.R. 788, the 
     so-called ``Stop Settlement Slush Funds Act of 2023''. The 
     bill prohibits settlement agreements where the United States 
     is a party from including certain ``donations'' to non-
     federal actors, primarily non-profits, educational, and 
     community-based organizations.
       Under existing laws, settlements from federal enforcement 
     actions can include payments to third parties to advance 
     programs that assist with recovery, benefits, and relief for 
     communities harmed by lawbreakers, to the extent such 
     payments further the objectives of the enforcement action. 
     H.R. 788 would cut off any payments to third parties other 
     than individualized restitution and other forms of direct 
     payment for ``actual harm.'' That restriction would handcuff 
     federal enforcement officials by limiting the ability of 
     federal enforcement officials to negotiate real relief for 
     harms caused to the public by illegal conduct that is the 
     subject of federal enforcement actions.
       This bill would be a gift to lawbreakers at the expense of 
     families and communities suffering from injuries that cannot 
     be addressed by direct restitution because the bill would 
     prevent federal agencies from negotiating forms of relief 
     that would address injuries to the public that may be either 
     non-quantifiable or indeterminate. These forms of relief are 
     crucial when harm is difficult to monetize, such as damage to 
     the environment, the collateral consequences to communities 
     resulting from predatory lending by financial institutions, 
     or unknown health outcomes to individuals resulting from 
     chemical exposures in the workplace.
       Under current law, the legitimacy and utility of federal 
     enforcement settlements that include payments to third 
     parties is clear, as long as such payments bear a nexus to 
     the prosecutorial objectives of the agency. This bill would 
     supplant the wisdom of officials at DOJ and federal agencies 
     to craft appropriate remedies.
       This bill is also just another example of Congressional 
     overreach into executive branch decision-making. Not only 
     does it disregard the needs of future Administrations, but 
     the bill is sloppily crafted, failing to provide even a basic 
     definition of the ``donations'' or payments in question.
       Further, the bill assumes that the government is always 
     going to be the party seeking to enforce the law, but this is 
     a fallacy. Laws are often enforced against the government, 
     and the government sometimes pays restitution to litigants. 
     There is a role for third parties to ensure that settlements 
     involving the government are followed and enforced.

[[Page H75]]

       Third parties that receive third-party payments include 
     nonprofits, community organizations, or trusts or foundations 
     that provide vital services in their communities. Members of 
     Congress should applaud the good work of these organizations 
     that serve the public good rather than vilify them.
       We urge you to oppose H.R. 788.
           Sincerely,
       Yosef Robele & Brielle Green, Earthjustice, American 
     Association of Justice, American Federation of State, County 
     and Municipal Employees (AFSCME), American Federation of 
     Teachers, Center for Biological Diversity, Center for Justice 
     & Democracy, Center for Progressive Reform, Clean Water 
     Action, Earthjustice, Environmental Defense Fund, 
     Environmental Law & Policy Center, Environmental Working 
     Group, Government Information Watch, Impact Fund, League of 
     Conservation Voters, National Association of Consumer 
     Advocates, National Consumers League, NRDC, Nuclear 
     Information and Resource Service, Public Justice, Union of 
     Concerned Scientists, Waterkeeper Alliance.

  Ms. JACKSON LEE. Mr. Speaker, I urge my colleagues to vote against 
H.R. 788. Don't take that tool away. Help the American people.
  Mr. Speaker, I rise today in strong opposition to H.R. 788, the Stop 
Settlement Slush Funds Act of 2023.
  This bill would undermine our ability to hold corporate wrongdoers 
accountable for unlawful conduct.
  H.R. 788, which otherwise could be called the ``Corporate 
Unaccountability Act,'' is another unconscionable attempt by some 
extreme members on the other side of the aisle to protect corporate 
wrongdoers at the expense of their victims and a continuation of this 
majority's dangerous quest to prevent federal agencies from enforcing 
key protections.
  H.R. 788 is yet another in a series of harmful bills that pose a 
direct threat to a broad range of critical protections Americans rely 
on in their daily lives by making it harder for federal agencies to 
implement, execute and enforce the laws passed by Congress.
  These bills are part of the extreme MAGA Republican agenda, which 
seeks to render the federal government ineffective by any means 
necessary.
  First, they proposed defunding and abolishing agencies that do not 
suit their radical views.
  Then, they broadened their scope and put forward their Default on 
America Act, and later their extreme CR, which would have massively 
underfunded the federal government, hurting its ability to address our 
nation's most important priorities.
  This week, the sabotage continues with legislation that puts 
corporate interests over communities by making it harder for agencies 
to hold corporations accountable for unlawful conduct and depriving 
victims of meaningful relief.
  H.R. 788 would prohibit federal agencies from entering or enforcing 
legal settlement agreements that include payments to third parties in 
cases of corporate misconduct.
  These third-party payments are important when the conduct at issue 
results in generalized harm, such as violations of public health, 
environmental or consumer protections.
  Recipients are often nonprofit, educational and community-based 
organizations.
  For example, the Department of Justice has reached settlement 
agreements in connection with the mortgage lending practices of major 
banks that required payments to legal aid organizations, community 
development financial institutions and housing counseling groups.
  Eliminating this practice, as H.R. 788 threatens to do, would 
materially weaken the federal government's ability to hold bad actors 
accountable for their unlawful conduct in a way that effectively 
addresses the societal injuries they have caused.
  This extreme and misguided legislation has earned opposition from 
both the Biden Administration and a broad coalition of groups, has zero 
Democratic cosponsors and only advanced out of the House Judiciary 
Committee by a party-line vote.
  According to President Biden's Statement of Administration Policy, 
H.R. 788 is unnecessary and ``would have adverse effects on the Federal 
government's ability to enforce key laws protecting the public, 
including criminal, bankruptcy, environmental and civil rights laws 
such as the Fair Housing Act and the Servicemembers' Civil Relief 
Act.''
  It should also be noted that the following groups who have come out 
in opposition of this irresponsible and dangerous bill:
  American Association for Justice; American Federation of State, 
County and Municipal Employees; American Federation of Teachers; Center 
for Biological Diversity; Center for Justice & Democracy; Center for 
Progressive Reform; Clean Water Action; Coalition for Sensible 
Safeguards; Earthjustice; Environmental Defense Fund; Environmental Law 
& Policy Center; Environmental Working Group; Government Information 
Watch; Impact Fund; League of Conservation Voters; National Association 
of Consumer Advocates; National Consumers League; NRDC; Nuclear 
Information and Resource Service; Public Justice; Union of Concerned 
Scientists; and Waterkeeper Alliance.
  Let me also highlight the fact that the Administration strongly 
opposes the House passage of H.R. 788, the Stop Settlement Slush Funds 
Act of 2023, because the legislation is unnecessary and would harm the 
public interest.
  H.R. 788 would prohibit the Federal government from entering into 
settlement agreements that include payments directed to appropriate 
parties.
  This legislation seeks to address a problem that does not exist--the 
Federal government does not create or use ``slush funds.''
  When the Federal government settles a case with those who violate the 
law, it seeks to hold bad actors accountable, to appropriately remedy 
the harm they have caused, and to prevent the recurrence of those 
harms.
  H.R. 788 would have adverse effects on the Federal government's 
ability to enforce key laws protecting the public, including criminal, 
bankruptcy, environmental, and civil rights laws such as the Fair 
Housing Act and the Servicemembers' Civil Relief Act.
  This bill would needlessly prohibit a widely respected and effective 
enforcement tool.
  Specifically, it would block many agencies from including certain 
terms providing for payment to third parties in settlement agreements 
to which the United States is a party.
  In the past, agencies have sometimes opted to work with entities that 
have violated regulatory requirements to agree to alternative forms of 
remediation.
  These efforts have resulted in settlement agreements that include 
payments by those entities to third parties to advance programs that 
assist with recovery, benefits, or relief for communities harmed by the 
wrongdoing addressed in the enforcement action.
  In this way, H.R. 788 would thwart federal enforcement officials' 
ability to negotiate appropriate relief for harm caused to the public 
by parties that are the subject of the enforcement action.
  The criticisms of third-party settlements are misplaced: they do not 
unduly undermine congressional appropriation power, and they must 
satisfy basic requirements to be used.
  The Congressional Research Service has found settlement payments to 
non-federal actors are permissible remedies to the extent they bear a 
nexus to the prosecutorial objectives of the agency.
  Moreover, developing guidelines on appropriate scope, purpose, and 
use of third-party payments appropriately lie with the executing 
agency, which has the benefit of expertise and experience.
  In sum, this bill is counterproductive and would undermine law 
enforcement goals by reducing the availability of effective remedies to 
address injuries to individuals and communities caused by illegal 
conduct. We therefore urge you to oppose H.R. 788, the Stop Settlement 
Slush Funds Act of 2023.
  Mr. GOODEN of Texas. Mr. Speaker, I yield 5 minutes to the gentleman 
from Montana (Mr. Zinke).
  Mr. ZINKE. Mr. Speaker, I rise in strong support of H.R. 788.
  First of all, we should ask what good governance looks like. I know 
that in the House of Representatives today, perhaps we are not 
reflective of good governance, but good governance, I would say, should 
include transparency. It should also include, I think, fairness, rule 
of law, and defending the Constitution, to which we all have sworn an 
oath.
  Article I, Section 9 in the Constitution says what? No money should 
be removed from the Treasury unless by consequence of appropriations by 
law. It is in the Constitution.
  Let me share a story about when I was Secretary. It is called sue, 
settle, and seal. I am sure that my good friend, the gentleman from New 
York, is aware of it.
  Let's say an administration writes a rule that is somewhat flawed. 
Let's say the administration invites a lawsuit from, let's say, the 
Center for Biological Diversity or other nonprofits. Let's say that 
department then decides to settle. On what conditions? Those conditions 
are met by the Department of Justice and not the Department of the 
Interior in this example. They are settled, and then the final act is 
that they seal them.
  In one case, I asked the President of the United States, which would 
be President Trump, I said: Mr. President, I have serious concerns 
about the conditions of this settlement. I would like you to ask the 
Attorney General to allow the Secretary of the Interior to view those.
  The President's answer was: I don't have the authority.
  Then, I asked Congress: Mr. Speaker, you have the power of the purse 
by the

[[Page H76]]

Constitution. I would like you, sir, to tell me the conditions of the 
settlement. Follow the money. Where did the money go?
  His answer was: I don't have the authority.
  When neither the President of the United States, the executive, nor 
the House of Representatives, which controls the purse, have the 
authority to look at sue, settle, and seal, something is wrong. That is 
what is called corruption.
  All of this should attain to the same thing--transparency. 
Furthermore, whose money is it? I have heard today it is the Federal 
Government's money. It is not. The government does not have the money. 
It is the taxpayers'. It is the citizens of this great Nation whose 
money we allocate and, by Constitution, we appropriate.
  Mr. Speaker, I stand in strong support of this bill, and I thank the 
great gentleman from Texas for bringing it forward.

                              {time}  1445

  Mr. NADLER. Mr. Speaker, I yield myself such time as I may consume.
  My Republican friends seem to be under a misconception about the 
bill. They keep saying that it unconstitutionally removes money from 
the Treasury without appropriation. It does no such thing. It removes 
not a dime from the Treasury. None of this money is the government's 
money to start with.
  The government sues some group or company for malefaction, for 
damaging people. A settlement is reached. Under the terms of that 
settlement, the bulk of the money goes to the Treasury, and there it 
stays. A small proportion of that money goes to an organization that 
attempts to make somewhat whole the victims of the corporate 
malfeasance that caused the lawsuit in the first place, but no money is 
removed from the Treasury. On the contrary, money is placed into the 
Treasury, money from the corporate malefactor. Some money from the 
corporate malefactor, a small proportion, goes to an organization that 
tries to help make not whole but a little better the victims of the 
malefaction by the corporation in the first place.
  Mr. Speaker, I reserve the balance of my time.
  Mr. GOODEN of Texas. Mr. Speaker, I yield myself such time as I may 
consume.
  It is really not always the case that the government gets a cut of 
these settlements. Let me give one example. A recent and shocking 
example involves the Epstein scandal. JPMorgan Chase entered into a $75 
million settlement for its role facilitating Mr. Epstein's heinous 
practices.
  It has been reported--of course, we don't know all the details here--
that of the $75 million settlement that they had in the Virgin Islands, 
$30 million went to charity--we don't know which ones--$25 million went 
to enhance Virgin Islands infrastructure--I am sure that was all 
appropriately spent--and $20 million went to attorneys' fees. None of 
it went to the U.S. Treasury. We now have reports of another settlement 
that they are working on with the Justice Department. We don't know 
where that went.
  Again, I will bring you back to this graphic I have. Of all the 
settlement funds, no one in this Chamber, no one in this building, no 
Member of Congress knows where 98.6 percent of that money went.
  Whatever you are hearing about how great these settlement slush funds 
are by the other side, they are only talking about what they think they 
know of the 1.4 percent, and what they think they know is what they are 
told because there is no accountability for these funds.
  Unlike Federal funds, which Congress should be appropriating, where 
we hold organizations accountable--if an entity is receiving Federal 
dollars, they have to account for it--when these settlement slush funds 
go out to whatever organization they go to, we don't have any idea how 
they are being spent. No Member of Congress has any control over that 
money.
  Mr. Nadler is right, it doesn't belong to the Federal Government, but 
when it is deposited into the Treasury instead of given to some aid 
group or whatever alleged great cause that the Justice Department is 
telling us exists, when it is deposited into the Treasury, then 
Congress gets to appropriate it because it is the people's money to 
handle as they see fit.
  First of all, victims should be given restitution, not some slush 
fund that claims to do right by victims. Secondly, after the victims, 
the money, if we want to do right, if we want to go enhance the soils 
after a disaster in Congresswoman Jackson's district, that is something 
that the executive branch should oversee with Federal dollars that this 
body appropriates. That is not something that we should outsource to 
some group at the direction of the executive branch.
  I share my colleague's concerns about victims. I am disappointed that 
the other side would stand up for these big businesses that are 
actually getting great deals, unfair deals where they get to write some 
slush fund check to some group that we have no way of showing any kind 
of accountability over. These big businesses are walking away. It is 
shocking to me that the other side is standing up for a process that 
actually lets big offenders walk away with a sweet deal and a good 
little PR press release. It is a shame.
  Mr. Speaker, I urge my colleagues to support this bill and oppose 
this practice.
  Mr. Speaker, I yield 2 minutes to the gentleman from South Carolina 
(Mr. Norman).
  Mr. NORMAN. Mr. Speaker, I rise in strong support of H.R. 788, the 
Stop Settlement Slush Funds Act of 2023.
  To be honest with you, I am amazed we are even debating this. The 
other side always takes the position they are for the little man. We 
are talking about giving money to people who have been harmed instead 
of letting the Federal Government keep it.
  I also heard my colleague from Texas cite how government is the gold 
standard, how government provides clean air, clean water, clean 
streets. The very State that she and Representative Gooden are from, 
Texas, is being overrun by illegals. Where is the government? Where is 
the government in stopping this illegal invasion on the border? It is 
for pure power. It is for reelection purposes. They are putting the 
American people at severe risk.
  Let me give Congressman Gooden some other examples of money that did 
not go to the victim. It went to a slush fund that was not revealed 
until people were asking about it. It is the example of the Obama-era 
EPA settlement with Volkswagen, where billions were diverted to 
projects Congress explicitly chose not to fund. It went to projects 
Congress didn't even fund.
  We have to restore accountability and order. This bill will correct a 
horrible trend that is developing in government, and the people who 
support government now is less than 5 percent. They have lost trust in 
government.
  Mr. Speaker, I appreciate Mr. Gooden bringing this bill up. It is a 
great bill, and I hope we can get it passed.
  Mr. NADLER. Mr. Speaker, I have no further speakers, and I reserve 
the balance of my time.
  Mr. GOODEN of Texas. Mr. Speaker, I yield myself such time as I may 
consume.
  Before I close, I will be nice and give my friends across the aisle a 
little gift. I realize they think all these are great, so for the sake 
of being bipartisan, I am going to give an example of a bad actor that 
was a Republican with respect to these slush funds.
  Back in 2005, then-United States Attorney Chris Christie required the 
pharmaceutical company Bristol Myers Squibb to donate to his law school 
alma mater, Seton Hall University. In exchange for not charging the 
drug-making giant with securities fraud, Christie's office would 
require it to fund a professorship at Seton Hall University Law School, 
Christie's alma mater.
  Do we really think that is good policy?
  It doesn't matter who is in the White House, what party is 
controlling the executive branch, this is a wrong policy. I hope this 
bill passes.
  My colleague did say it is dead in the Senate. Let's just assume it 
is dead in the Senate. I pledge here before this entire body that if we 
have a Republican President someday, I will carry this bill forward, 
and I am willing to bet that someone across the aisle will join me 
because they won't like the conservative, far-right groups that a

[[Page H77]]

Republican Justice Department is diverting slush funds to.
  I hope that my colleagues will get on board now. If this bill should 
not make it to the President's desk, I will be right back here in a 
year, God willing, if a Republican is President, and I hope my 
colleagues will join me then.
  Mr. Speaker, I reserve the balance of my time.
  Mr. NADLER. Mr. Speaker, I yield myself the balance of my time to 
close.
  I reiterate that H.R. 788 is a solution in search of a problem that 
if enacted would seriously hamstring the ability of Federal agencies to 
hold corporate wrongdoers accountable to the American public.
  Given its potentially broad impact, H.R. 788 is opposed by a wide 
range of environmental, civil justice, labor, and consumer advocacy 
groups, including the American Federation of State, County, and 
Municipal Employees, the American Federation of Teachers, Earthjustice, 
the Environmental Defense Fund, the League of Conservation Voters, the 
American Association for Justice, the National Association of Consumer 
Advocates, and the National Consumers League.
  If the underlying practice, as my friends on the other side of the 
aisle say, were really such a gift to corporations, why has the Chamber 
of Commerce come out in favor of this bill?
  Mr. Speaker, I urge my colleagues to vote ``no'' on H.R. 788, and I 
yield back the balance of my time.
  Mr. GOODEN of Texas. Mr. Speaker, this is really bad business for the 
American people. These settlement slush funds are wrong no matter who 
is in power and, frankly, victims are being overlooked. Victims should 
be made whole, and any other kind of settlement the government wants to 
work out with wrongdoers should be a fine to the United States Treasury 
because whatever good cause we may agree or disagree about for 
restitution for larger groups of victims, perhaps, that is something 
this Congress should decide through the appropriations process.
  I encourage my colleagues to join me in stopping this practice. We 
have seen abuses all the way from the Bush administration to the 
present, and it needs to stop.
  Mr. Speaker, I urge my colleagues to support H.R. 788, and I yield 
back the balance of my time.
  The SPEAKER pro tempore. All time for debate on the bill has expired.


                Amendment No. 1 Offered by Mr. McCormick

  The SPEAKER pro tempore. It is now in order to consider amendment No. 
1 printed in House Report 118-342.
  Mr. McCORMICK. Mr. Speaker, I have an amendment at the desk.
  The SPEAKER pro tempore. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Page 3, line 13, after ``submit'' insert ``, and make 
     available on a publicly accessible website,''.

  The SPEAKER pro tempore. Pursuant to House Resolution 947, the 
gentleman from Georgia (Mr. McCormick) and a Member opposed each will 
control 5 minutes.
  The Chair recognizes the gentleman from Georgia.
  Mr. McCORMICK. Mr. Speaker, I rise to offer an amendment to H.R. 788.
  I thank Representative Gooden and the Judiciary Committee for 
crafting this crucial piece of legislation that will further our 
mission of holding the executive branch accountable.
  The underlying bill is trying to fix an important issue. The Biden 
administration, or any administration for that matter, should not be 
directing settlement funds to support their radical social agendas by 
financing politically favored third-party entities or programs, 
sometimes completely unrelated to the original litigation. This 
practice is just wrong.
  My amendment is simple. It creates transparency by requiring the 
annual violation audits conducted by the inspector generals in section 
2(f) of this bill to be made publicly available on an accessible 
website. The American people deserve to know what their government is 
doing. If a government agency, in violation of law, is directing these 
settlement payments to support political agendas, the public should 
know.
  Mr. Speaker, I reserve the balance of my time.
  Mr. NADLER. Mr. Speaker, I claim the time in opposition, though I am 
not opposed.
  The SPEAKER pro tempore. Without objection, the gentleman from New 
York is recognized for 5 minutes.
  There was no objection.
  Mr. NADLER. Mr. Speaker, I will not take 5 minutes.
  Mr. Speaker, for all the reasons I have stated here, this is a 
terrible bill. This amendment makes it no worse. Therefore, I don't 
oppose it.
  Mr. Speaker, I yield back the balance of my time.
  Mr. McCORMICK. Mr. Speaker, in closing, I am glad he does not oppose 
it because it is transparency on a bill that is meant to create 
transparency. I hope nobody opposes that.
  Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore. Pursuant to the rule, the previous question 
is ordered on the amendment offered by the gentleman from Georgia (Mr. 
McCormick).
  The question is on the amendment.
  The amendment was agreed to.
  The SPEAKER pro tempore. The question is on the engrossment and third 
reading of the bill.
  The bill was ordered to be engrossed and read a third time, and was 
read the third time.


                           Motion to Recommit

  Mrs. FOUSHEE. Mr. Speaker, I have a motion to recommit at the desk.
  The SPEAKER pro tempore. The Clerk will report the motion to 
recommit.
  The Clerk read as follows:

       Mrs. Foushee of North Carolina moves to recommit the bill 
     H.R. 788 to the Committee on the Judiciary.

  The material previously referred to by Mrs. Foushee is as follows:
       Mrs. Foushee moves to recommit the bill H.R. 788 to the 
     Committee on the Judiciary with instructions to report the 
     same back to the House forthwith with the following 
     amendment:
       Page 2, line 7, insert after ``settlement agreement'' the 
     following: ``(except as provided in subsection (g))''.
       Add at the end of the bill the following:
       (g) Exception.--The provisions of this Act do not apply in 
     the case of a settlement agreement that pertains to the abuse 
     and diversion of prescription and synthetic opioids, 
     including fentanyl, and that includes allegations of false 
     claims against the United States related to a health care 
     benefit program (as such term is defined in section 24 of 
     title 18, United States Code).

  The SPEAKER pro tempore. Pursuant to clause 2(b) of rule XIX, the 
previous question is ordered on the motion to recommit.
  The question is on the motion to recommit.
  The question was taken; and the Speaker pro tempore announced that 
the noes appeared to have it.
  Mrs. FOUSHEE. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, further 
proceedings on this question are postponed.

                          ____________________