[Congressional Record (Bound Edition), Volume 155 (2009), Part 3]
[Senate]
[Pages 2991-2999]
[From the U.S. Government Publishing Office, www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. LUGAR (for himself, Mr. Casey, and Mr. Durbin):
  S. 384. A bill to authorize appropriations for fiscal years 2010 
through 2014 to provide assistance to foreign countries to promote food 
security, to stimulate rural economies, and to improve emergency 
response to food crises, to amend the Foreign Assistance Act of 1961, 
and for other purposes; to the Committee on Foreign Relations.
  Mr. LUGAR. Mr. President, I am pleased today to announce the 
introduction of the Global Food Security Act of 2009. I would like to 
thank my friend Senator Casey for lending his ideas and support to this 
bipartisan effort, and Senator Durbin for his early cosponsorship. 
Finally, I want to thank the members of USAID's informal food security 
team, who advised us on the nature of food insecurity and possible 
legislative solutions.
  As we know, food prices started a steep climb in the fall of 2007 and 
continued to increase during 2008. The increases pushed an additional 
75 million people into poverty. While prices have abated somewhat, 
millions of people still face difficulty in food access and 
availability, and malnutrition rates in many parts of the world remain 
alarmingly high. The price crisis demonstrated that there are 
significant structural challenges to attaining global food security. 
The system is vulnerable to periodic disruptions that both expose and 
exacerbate deeper problems.
  We live in a world where nearly one billion people suffer from 
chronic food insecurity. When droughts occur, hurricanes hit, or other 
disruptions arise--

[[Page 2992]]

creating transitory food insecurity the economic prospects of those 
living in or near poverty are gravely threatened. In fact, the World 
Food Program reports that 25,000 people die each day from malnutrition-
related causes. Health experts advise us that a diverse and secure food 
supply has major health benefits, including increasing child survival, 
improving cognitive and physical development of children, and 
increasing immune system function including resistance to HIV/AIDS. 
Prolonged malnutrition in children results in stunting and cognitive 
difficulties that last a lifetime.
  Food insecurity is a global tragedy, but it is also an opportunity 
for the United States. The United States is the indisputable world 
leader in agricultural production and technology. A more focused effort 
on our part to join with other nations to increase yields, create 
economic opportunities for the rural poor, and broaden agricultural 
knowledge could begin a new era in U.S. diplomacy. Such an effort could 
improve our broader trade relations and serve as a model for similar 
endeavors in the areas of energy and scientific cooperation. Achieving 
food security for all people also would have profound implications for 
peace and U.S. national security. Hungry people are desperate people, 
and desperation often sows the seeds of conflict and extremism.
  The United States has always stood for big ideas--from the founding 
of the Republic on the basis of freedom to President Kennedy's vow to 
put a man on the moon. One of today's big ideas should be the 
eradication of hunger. We can bring America's dedication to science, 
innovation, technology, and education together to lead an effort 
devoted to overcoming the obstacles to food security.
  The Global Food Security Act of 2009 is a 5-year authorization that 
seeks to provide solutions that will have the greatest effect. First, 
it creates a Special Coordinator for Global Food Security and puts that 
person in charge of developing a food security strategy. We call on the 
development of that strategy to take a whole-of-government approach and 
to work with other international donors, the NGO community, and the 
private sector. Addressing food security requires more than investing 
in agriculture; it also requires improvements in infrastructure, the 
development of markets, access to finance, and sound land tenure 
systems, to name just a few.
  Second, the bill authorizes additional resources for agricultural 
productivity and rural development. U.S. foreign assistance for 
agriculture has declined by nearly 70 percent since the 1980s. 
Globally, only four percent of official development assistance from all 
donors is currently allocated for agriculture. This amounts to neglect 
of what should be considered one of the most vital sectors in the 
alleviation of poverty. Food shortages are likely to recur frequently 
if the United States and the global community fail to invest in 
agricultural productivity in the developing world.
  Third, the bill improves the U.S. emergency response to food crises 
by creating a separate Emergency Food Assistance Fund that can make 
local and regional purchases of food, where appropriate. Funds can be 
used for emergency food and non-food assistance. The Government 
Accountability Office reports that it can often take four to six months 
from the time a crisis occurs until U.S. food shipments arrive. Our 
intention is to provide USAID with the flexibility to respond to 
emergencies more quickly in order to complement food aid programs in 
the U.S. Department of Agriculture.
  World leaders must understand that over the long term, satisfying 
global demand for more and better food can be achieved only by 
increasing yields per acre. In the 1930s, my father, Marvin Lugar, 
produced corn yields of approximately 40 to 50 bushels per acre. Today, 
the Lugar farm yields about 150 bushels per acre on the same land in 
Marion County, Indiana. The Green Revolution saw the introduction of 
high yield seeds and improved agricultural techniques that resulted in 
a near doubling of cereal grain production per acre over 20 years. But 
more recently, food production has not kept pace with population 
increases. By 2050, it is projected that population growth will require 
another doubling of food production. Unless much greater effort is 
devoted to this problem, the world is likely to experience more 
frequent and intense food crises that increase migration, stimulate 
conflicts and intensify pandemics.
  Moreover, the task of doubling food production is likely to be 
complicated by the effects of climate change. The important report by 
Sir Nicolas Stern estimated that a 2 degree celsius increase in global 
temperature will cut agricultural yields in Africa by as much as 35 
percent. Thus, farmers around the world will be asked to meet the 
demands of global demographic expansion, even as they may be contending 
with a degrading agricultural environment that significantly depresses 
yields in some regions.
  Increasing acreage under production will not satisfy the growth in 
food demand, and these steps come with serious environmental and 
national security costs. We need a second green revolution that will 
benefit developed and developing nations alike.
  Recent studies have demonstrated that funds spent in agriculture can 
be up to twice as beneficial to economic growth as spending in other 
areas. It seems, therefore, that our overall foreign aid strategy would 
benefit from restoring agriculture programs to their former prominence. 
The bill increases funding for these programs in the first year by $750 
million. The increase would reach $2.5 billion in year five. Because 
those who subsist on less than $1 a day spend at least half their 
incomes on food, according to the International Food Policy Research 
Institute, the bill highlights the need to focus on those living in 
extreme poverty.
  In thinking about how to approach agricultural productivity, we tried 
to draw from the experience of U.S. land grant colleges and the 
contributions they have made to U.S. agriculture. The bill seeks to 
strengthen institutions of higher education in the areas of agriculture 
sciences, research and extension programs. Investments in human capital 
and institutional capacity are important to developing a robust 
agricultural sector.
  Universities and research centers can play an important role in 
achieving technological advances that are appropriate to local 
conditions. As such, the bill calls for increasing collaborative 
research on the full range of biotechnological advances including 
genetically modified technologies.
  I hope that our bill will begin a productive dialogue on how our 
government can be a more effective partner with NGOs and private actors 
in promoting food security. There is no good reason why nearly a 
billion people should be food insecure or that the world should have to 
endure the social upheaval and risks of conflict that this insecurity 
causes.
  I look forward to working with colleagues to improve the U.S. and 
global efforts to alleviate food insecurity and advance agricultural 
knowledge and technology worldwide.
                                 ______
                                 
      By Mr. AKAKA (for himself, Mr. Lautenberg, Mrs. McCaskill, Mr. 
        Sanders, Mr. Wyden, Mr. Carper, and Mr. Durbin):
  S. 385. A bill to reaffirm and clarify the authority of the 
Comptroller General to audit and evaluate the programs, activities, and 
financial transactions of the intelligence community, and for other 
purposes; to the Select Committee on Intelligence.
  Mr. AKAKA. Mr. President, I rise today to introduce the Intelligence 
Community Audit Act of 2009, with Senators Carper, Durbin, Lautenberg, 
McCaskill, Sanders, and Wyden. This legislation reaffirms and clarifies 
the authority of the Comptroller General of the United States, as head 
of the Government Accountability Office, GAO, to audit and evaluate the 
programs and activities of the Intelligence Community, IC.
  Our bill is not new. I have introduced similar bills twice before. 
But today, as I reintroduce this bill, I share with many of my 
colleagues a renewed commitment to accountability. This legislation 
would be an important step in

[[Page 2993]]

that direction. GAO has well-established expertise that should be 
leveraged to improve the performance of the Intelligence Community. In 
particular, GAO could provide much needed guidance to the IC related to 
human capital, financial management, information sharing, strategic 
planning, information technology, and other areas of management and 
administration. By employing GAO's expertise to improve IC management 
and operations while carefully protecting sensitive information, this 
bill would reinforce the Intelligence Community's ability to meet its 
mission.
  The Intelligence Community has faced greater demands and increased 
responsibilities over the past few years. It is Congress's 
responsibility to ensure that the IC carries out its critical functions 
effectively and consistent with congressional authorization. For too 
long, GAO's expertise and ability to engage in constructive oversight 
of the IC have been underutilized. This legislation would enhance, in a 
complementary manner, rather than detract from the work of the 
congressional intelligence committees. Dr. Marvin Ott, a former 
professional staff member on the Senate Select Committee on 
Intelligence, testified before my Subcommittee on Oversight of 
Government Management in February 2008 that the growth in the 
complexity, diversity, and size of the IC requires additional oversight 
resources. GAO is in a position to help. According to then-Comptroller 
General David Walker, who testified at the same hearing, GAO has the 
expertise and cleared personnel to increase the management oversight of 
the IC.
  I also believe that safeguards need to be in effect to protect the 
IC's most sensitive information from unauthorized disclosure. Under 
this bill, only the Senate Select Committee on Intelligence, the House 
Permanent Select Committee on Intelligence, and the majority and the 
minority leaders of the Senate and the House of Representatives would 
be able to request reviews of intelligence sources and methods or 
covert actions. Results of an audit of this nature would be restricted 
to the original requester, the Director of National Intelligence, and 
the head of the relevant IC element. Employees of the GAO participating 
in these audits would be subject to the same penalties for unauthorized 
disclosure or use of sensitive information as their counterparts in the 
IC. There are additional mechanisms in place to keep this information 
secure.
  Congress and GAO have a crucial role in ensuring that the IC elements 
are fulfilling their responsibilities of protecting this country. By 
removing the barrier to more comprehensive oversight, this bill will 
help improve our national security.
  Mr. Presdient, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                 S. 385

       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 ``Intelligence Community Audit 
     Act of 2009''.

     SEC. 2. COMPTROLLER GENERAL AUDITS AND EVALUATIONS OF 
                   ACTIVITIES OF ELEMENTS OF THE INTELLIGENCE 
                   COMMUNITY.

       (a) Reaffirmation and Clarification of Authority; Audits of 
     Intelligence Community Activities.--Chapter 35 of title 31, 
     United States Code, is amended by inserting after section 
     3523 the following:

     ``Sec. 3523a. Audits of intelligence community; audits and 
       requesters

       ``(a) In this section, the term `element of the 
     intelligence community' means an element of the intelligence 
     community specified in or designated under section 3(4) of 
     the National Security Act of 1947 (50 U.S.C. 401a(4)).
       ``(b) Congress finds that--
       ``(1) the authority of the Comptroller General to perform 
     audits and evaluations of financial transactions, programs, 
     and activities of elements of the intelligence community 
     under sections 712, 717, 3523, and 3524, and to obtain access 
     to records for purposes of such audits and evaluations under 
     section 716, is reaffirmed for matters referred to in 
     paragraph (2); and
       ``(2) such audits and evaluations may be requested by any 
     committee of jurisdiction (including the Committee on 
     Homeland Security and the Committee on the Judiciary of the 
     House of Representatives and the Committee on Homeland 
     Security and Governmental Affairs and the Committee on the 
     Judiciary of the Senate), and may include matters relating to 
     the management and administration of elements of the 
     intelligence community in areas such as strategic planning, 
     financial management, information technology, human capital, 
     knowledge management, and information sharing (including 
     information sharing by and with the Department of Homeland 
     Security and the Department of Justice).
       ``(c)(1) The Comptroller General may conduct an audit or 
     evaluation of intelligence sources and methods or covert 
     actions only upon request of the Select Committee on 
     Intelligence of the Senate or the Permanent Select Committee 
     on Intelligence of the House of Representatives, or the 
     majority or the minority leader of the Senate or the House of 
     Representatives.
       ``(2)(A) Whenever the Comptroller General conducts an audit 
     or evaluation under paragraph (1), the Comptroller General 
     shall provide the results of such audit or evaluation only to 
     the original requestor, the Director of National 
     Intelligence, and the head of the relevant element of the 
     intelligence community.
       ``(B) The Comptroller General may only provide information 
     obtained in the course of an audit or evaluation under 
     paragraph (1) to the original requestor, the Director of 
     National Intelligence, and the head of the relevant element 
     of the intelligence community.
       ``(3)(A) Notwithstanding any other provision of law, the 
     Comptroller General may inspect records of any element of the 
     intelligence community relating to intelligence sources and 
     methods, or covert actions in order to conduct audits and 
     evaluations under paragraph (1).
       ``(B) If in the conduct of an audit or evaluation under 
     paragraph (1), an agency record is not made available to the 
     Comptroller General in accordance with section 716, the 
     Comptroller General shall consult with the original requestor 
     before filing a report under subsection (b)(1) of such 
     section.
       ``(4)(A) The Comptroller General shall maintain the same 
     level of confidentiality for a record made available for 
     conducting an audit under paragraph (1) as is required of the 
     head of the element of the intelligence community from which 
     it is obtained. Officers and employees of the Government 
     Accountability Office are subject to the same statutory 
     penalties for unauthorized disclosure or use as officers or 
     employees of the intelligence community element that provided 
     the Comptroller General or officers and employees of the 
     Government Accountability Office with access to such records.
       ``(B) All workpapers of the Comptroller General and all 
     records and property of any element of the intelligence 
     community that the Comptroller General uses during an audit 
     or evaluation under paragraph (1) shall remain in facilities 
     provided by that element of the intelligence community. 
     Elements of the intelligence community shall give the 
     Comptroller General suitable and secure offices and 
     furniture, telephones, and access to copying facilities, for 
     purposes of audits and evaluations under paragraph (1).
       ``(C) After consultation with the Select Committee on 
     Intelligence of the Senate and with the Permanent Select 
     Committee on Intelligence of the House of Representatives, 
     the Comptroller General shall establish procedures to protect 
     from unauthorized disclosure all classified and other 
     sensitive information furnished to the Comptroller General or 
     any representative of the Comptroller General for conducting 
     an audit or evaluation under paragraph (1).
       ``(D) Before initiating an audit or evaluation under 
     paragraph (1), the Comptroller General shall provide the 
     Director of National Intelligence and the head of the 
     relevant element with the name of each officer and employee 
     of the Government Accountability Office who has obtained 
     appropriate security clearance and to whom, upon proper 
     identification, records, and information of the element of 
     the intelligence community shall be made available in 
     conducting the audit or evaluation.
       ``(d) Elements of the intelligence community shall 
     cooperate fully with the Comptroller General and provide 
     timely responses to Comptroller General requests for 
     documentation and information.
       ``(e) With the exception of the types of audits and 
     evaluations specified in subsection (c)(1), nothing in this 
     section or any other provision of law shall be construed as 
     restricting or limiting the authority of the Comptroller 
     General to audit and evaluate, or obtain access to the 
     records of, elements of the intelligence community absent 
     specific statutory language restricting or limiting such 
     audits, evaluations, or access to records.''.
       (b) Technical and Conforming Amendment.--The table of 
     sections for chapter 35 of title 31, United States Code, is 
     amended by inserting after the item relating to section 3523 
     the following:

``3523a. Audits of intelligence community; audits and requesters.''.

[[Page 2994]]


                                 ______
                                 
      By Mr. LEAHY (for himself, Mr. Grassley, and Mr. Kaufman):
  S. 386. A bill to improve enforcement of mortgage fraud, securities 
fraud, financial institution fraud, and other frauds related to federal 
assistance and relief programs, for the recovery of funds lost to these 
frauds, and for other purposes; to the Committee on the Judiciary.
  Mr. LEAHY. Mr. President, today, I am pleased to introduce with 
Senator Grassley the Fraud Enforcement and Recovery Act, FERA, of 2009, 
a bipartisan bill that will reinvigorate our Nation's capacity to 
investigate and prosecute the kinds of financial frauds that have so 
severely undermined our economy and hurt so many hard working people in 
this country.
  Our Nation is in the midst of its most serious economic crisis since 
the Great Depression. With each passing week, tens of thousands more 
Americans lose their jobs to layoffs, and many thousands have already 
lost their homes to foreclosure. We learn more and more each day about 
the causes of this debacle, and it is now clear that unscrupulous 
mortgage brokers and Wall Street financiers were among the principle 
contributors of this economic collapse.
  As the crisis worsened last fall, I called upon Federal law 
enforcement to track down and punish those whose conduct went beyond 
mere negligence or incompetence and who were directly responsible for 
the corporate and mortgage frauds that helped make the economic 
downturn far worse than anyone predicted. With the new tools and 
resources in this bill, it will be easier to ensure that all of those 
responsible for these financial crimes are held accountable.
  While the full scope of the fraud that triggered this economic crisis 
is still unknown, we have already learned a great deal about what went 
wrong. As banks and private mortgage companies relaxed their standards 
for loans, approving ever riskier mortgages with less and less due 
diligence, they created an environment that invited fraud. Private 
mortgage brokers and lending businesses came to dominate the home 
housing market, and these companies were not subject to the kind of 
banking oversight and internal regulations that had traditionally 
helped to prevent fraud. We are now seeing the results of this lax 
supervision and accountability.
  In the last six years, suspicious activity reports alleging mortgage 
fraud that have been filed with the Treasury Department have increased 
more than tenfold, from about 5,400 in 2002 to more than 60,000 in 
2008. In the last three years, the number of criminal mortgage fraud 
investigations opened by the FBI has more than doubled, and the FBI 
anticipates a new wave of cases that may double that number yet again. 
Despite the increase, the FBI currently has fewer than 250 special 
agents nationwide assigned to financial fraud cases. At current levels, 
they cannot even begin to investigate the more than 5,000 fraud 
allegations they receive from the Treasury Department each month.
  Of course, the problem is not limited to mortgage frauds. As is so 
common in today's financial markets, home mortgages were packaged 
together and turned into securities that were bought and sold in 
largely unregulated markets on Wall Street. Here again, the environment 
invited fraud. As the value of the mortgages started to decline with 
falling housing prices, Wall Street financiers began to see these 
mortgage-backed securities unravel. Unfortunately, some were not honest 
about these securities, leading to even more fraud, and victimizing 
investors nationwide.
  All of this fraud has contributed to an unprecedented collapse in the 
mortgage-backed securities market. In the past year, banks and 
financial institutions in the United States alone have suffered more 
than $500 billion in losses associated with the sub-prime mortgage 
industry. Some of our Nation's largest and most venerable financial 
institutions collapsed as a result. The list of publicly-traded 
companies that declared bankruptcy or have been taken over by the 
Federal Government because of the mortgage-backed securities market 
collapse include Fannie Mae, Freddie Mac, Bear Stearns, IndyMac, and 
Lehman Brothers.
  As we take steps to make sure this kind of collapse cannot happen 
again, we must reinvigorate our anti-fraud measures and give law 
enforcement the tools and resources they need to root out fraud so that 
it can never again place our financial system at risk. Taxpayers, who 
bear the burden of this financial downturn, deserve to know that 
government is doing all it can to hold responsible those who committed 
fraud in the run-up to this collapse. This bill will do just that.
  This bipartisan legislation begins by providing the resources needed 
for law enforcement to uncover and go after these frauds. The bill 
authorizes $155 million a year for hiring fraud prosecutors and 
investigators at the Justice Department for fiscal years 2010 and 2011. 
This includes $65 million a year for the FBI to bring on 190 additional 
special agents and more than 200 professional staff and forensic 
analysts to rebuild its ``white collar'' investigation program. With 
this funding, the FBI can double the number of its mortgage fraud task 
forces nationwide--from 26 to more than 50--that target fraud in the 
hardest hit areas in our Nation. This also includes $50 million a year 
for U.S. Attorneys' offices to staff those strike forces and $40 
million for the criminal, civil, and tax divisions at the Justice 
Department to provide special litigation and investigative support to 
those efforts. The bill also authorizes $60 million a year for fiscal 
years 2010 and 2011 for investigators and analysts at the U.S. Postal 
Inspection Service and the Office of Inspector General for the Housing 
and Urban Development Department to combat fraud against Federal 
assistance programs and financial institutions.
  Of course, the economic recovery legislation includes new 
appropriations of $75 million for FBI salaries and $2 million for the 
Inspector General for the Treasury Department, yet certainly far more 
needs to be done to address the full scope of these enforcement issues 
now and in the future.
  The Fraud Enforcement and Recovery Act also makes a number of 
straightforward, important improvements to fraud and money laundering 
statutes to strengthen prosecutors' ability to combat this growing wave 
of fraud. Specifically, the bill amends the definition of ``financial 
institution'' in the criminal code in order to extend Federal fraud 
laws to mortgage lending businesses that are not directly regulated or 
insured by the Federal Government. These companies were responsible for 
nearly half the residential mortgage market before the economic 
collapse, yet they remain largely unregulated and outside the scope of 
traditional Federal fraud statutes. This change will apply the Federal 
fraud laws to private mortgage businesses like Countrywide Home Loans 
and GMAC Mortgage, just as they apply to federally insured and 
regulated banks.
  The bill would also amend the major fraud statute to protect funds 
expended under the Troubled Asset Relief Program and the economic 
stimulus package, including any government purchases of preferred stock 
in financial institutions. The U.S. Government has provided 
extraordinary economic support to our banking system, and we need to 
make sure that none of those funds are subject to fraud or abuse. This 
change will give Federal prosecutors and investigators the explicit 
authority they need to protect taxpayer funds.
  The legislation would amend the Federal securities statute to cover 
fraud schemes involving commodities futures and options, including 
derivatives involving the mortgage-backed securities that caused such 
damage to our banking system.
  This bill will also strengthen one of the core offenses in so many 
fraud cases--money laundering--which was significantly weakened by a 
recent Supreme Court case. In United States v. Santos, the Supreme 
Court misinterpreted the money laundering statutes,

[[Page 2995]]

limiting their scope to only the ``profits'' of crimes, rather than the 
``proceeds'' of the offenses. The Court's mistaken decision was 
contrary to Congressional intent and will lead to financial criminals 
escaping culpability simply by claiming their illegal scams had not 
made a profit. This erroneous decision must be corrected immediately, 
as dozens of money laundering cases have already been dismissed.
  Lastly, FERA improves one of the most potent civil tools we have for 
rooting out waste and fraud in government--the False Claims Act. The 
effectiveness of the False Claims Act has recently been undermined by 
court decisions which limit the scope of the law and allow sub-
contractors paid with government money to escape responsibility for 
proven frauds. The False Claims Act must quickly be corrected and 
clarified in order to protect from fraud the Federal assistance and 
relief funds expended in response to our current economic crisis.
  The Federal Government has spent hundreds of billions of dollars to 
stabilize our banking system, and Congress will soon spend even more to 
restart our economic recovery. But to date, we have paid far too little 
attention to investigating and prosecuting the mortgage and corporate 
frauds that has so dramatically contributed to this economic collapse.
  Congress should move quickly to pass this legislation so the American 
taxpayers can be confident that those who are criminally responsible 
for contributing to this economic disaster are caught and held fully 
accountable and to ensure that the money we are now spending to restore 
America is protected from fraud in the future.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                 S. 386

       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 ``Fraud Enforcement and 
     Recovery Act of 2009'' or ``FERA''.

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

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

     ``Sec. 27. Mortgage lending business defined

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

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

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

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

       (a) In General.--
       (1) Authorization.--There is authorized to be appropriated 
     to the Attorney General, to remain available until expended, 
     $155,000,000 for each of the fiscal years 2010 and 2011, for 
     the purposes of investigations, prosecutions, and civil 
     proceedings involving federal assistance programs and 
     financial institutions, including financial institutions to 
     which this Act and amendments made by this Act apply.
       (2) Allocations.--With respect to fiscal years 2010 and 
     2011, the amount authorized to be appropriated under 
     paragraph (1) shall be allocated as follows:
       (A) Federal Bureau of Investigation: $65,000,000.
       (B) The offices of the United States Attorneys: 
     $50,000,000.
       (C) The criminal division of the Department of Justice: 
     $20,000,000.
       (D) The civil division of the Department of Justice: 
     $15,000,000.
       (E) The tax division of the Department of Justice: 
     $5,000,000.
       (b) Additional Appropriations for the Postal Inspection 
     Service.--There is authorized to be appropriated to the 
     Postal Inspection Service of the United States Postal 
     Service, $30,000,000 for each of the fiscal years 2010 and 
     2011 for investigations involving federal assistance programs 
     and financial institutions, including financial institutions 
     to which this Act and amendments made by this Act apply.
       (c) Additional Appropriations for the Inspector General for 
     the Housing and Urban Development Department.--There is 
     authorized to be appropriated to the Inspector General of the 
     Department of Housing and Urban Development, $30,000,000 for 
     each of the fiscal years 2010 and 2011 for investigations 
     involving Federal assistance programs and financial 
     institutions, including financial institutions to which this 
     Act and amendments made by this Act apply.
       (d) Use of Funds.--The funds authorized to be appropriated 
     under subsections (a), (b), and (c), shall be limited to 
     cover the costs of each listed agency or department for 
     investigating possible criminal, civil, or administrative 
     violations and for prosecuting criminal, civil, or 
     administrative proceedings involving financial crimes and 
     crimes against Federal assistance programs, including 
     mortgage fraud, securities fraud, financial institution 
     fraud, and other frauds related to Federal assistance and 
     relief programs
       (e) Report to Congress.--Following the final expenditure of 
     all funds appropriated under this section that were 
     authorized by subsections (a), (b), and (c), the Attorney 
     General, in consultation with the United States Postal 
     Inspection Service and the Inspector General for the 
     Department of Housing and Urban Development, shall submit a 
     joint report to Congress identifying--
       (1) the amounts expended under subsections (a), (b), and 
     (c) and a certification of compliance with the requirements 
     listed in subsection (d); and

[[Page 2996]]

       (2) the amounts recovered as a result of criminal or civil 
     restitution, fines, penalties, and other monetary recoveries 
     resulting from criminal, civil, or administrative proceedings 
     and settlements undertaken with funds authorized by this Act.

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

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

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

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

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

       ``(B) does not include requests or demands for money or 
     property that the Government has paid to an individual as 
     compensation for Federal employment or as an income subsidy 
     with no restrictions on that individual's use of the money or 
     property; and
       ``(3) the term `obligation' means a fixed duty, or a 
     contingent duty arising from an express or implied 
     contractual, quasi-contractual, grantor-grantee, licensor-
     licensee, fee-based, or similar relationship, and the 
     retention of any overpayment.'';
       (3) by redesignating subsections (d) and (e) as subsections 
     (c) and (d), respectively; and
       (4) in subsection (c), as redesignated, by striking 
     ``subparagraphs (A) through (C) of subsection (a)'' and 
     inserting ``subsection (a)(2)''.

  Mr. KAUFMAN. Mr. President, as we struggle to restore growth and hope 
to our economy, we must continue to repair the weaknesses in our legal 
and regulatory system weaknesses that contributed to the crisis we face 
today. A lot of what has happened to our economy was the result of 
greed and incompetence. But too much of it can be traced to fraud, 
insider deals, and other acts that are illegal, and to actions that 
should be illegal.
  That is why I am joining today with Senator Leahy and Senator 
Grassley to introduce the Fraud Enforcement and Recovery Act of 2009. 
As we survey the damage to every aspect of our economy from 
manufacturing to retail, from construction to services we can trace the 
origins of this disaster to the real estate market and the financing 
that drove a bubble that finally burst.
  We now know that behind the explosion in housing values, and the 
explosion in the secondary market for mortgages, were 
misrepresentations, false reporting, insider deals, and other forms of 
fraud. Many of these actions clearly broke existing financial 
regulations and consumer protection laws. Others took place in so-
called ``shadow'' financial markets that are outside of our existing 
laws.
  The legislation we are introducing today will provide the Justice 
Department with the resources it needs to prosecute the crimes that 
played a part in precipitating the crisis we are now facing. The FBI 
has been overwhelmed by reports of mortgage fraud, now running at over 
ten times the pace of a few years ago.
  The bill authorizes $155 million a year for hiring fraud prosecutors 
and investigators at the Justice Department for 2010 and 2011, 
including $65 million a year for 190 additional FBI special agents and 
more than 200 professionals to fight white collar crime.
  In addition, this bill exposes some of the ``shadow'' financial 
systems to the fraud laws that apply today in the better regulated 
sectors of our banking industry. It also extends antifraud protections 
to the money we are sending out under the Troubled Asset Relief Program 
and the economic stimulus package. It also amends Federal securities 
laws to cover fraud schemes involving commodities futures and options, 
including so-called derivatives involving the mortgage-backed 
securities that caused such damage to our banking system.
  Further, this legislation will strengthen one of the most effective 
tools to combat waste and fraud in government the False Claims Act. We 
will need these improvements so that we can protect the taxpayer 
dollars we are using to respond to the economic crisis.
  I hope we can move this legislation quickly. It moves against the 
root causes of this economic crisis and improves protections for the 
taxpayer funds we are committing to fight it.
                                 ______
                                 
      By Mr. DURBIN:
  S. 387. A bill to designate the United States courthouse located at 
211 South Court Street, Rockford, Illinois, as the ``Stanley J. 
Roszkowski United States Courthouse''; to the Committee on Environment 
and Public Works.
  Mr. DURBIN. Mr. President, today I am pleased to introduce 
legislation to designate the United States Courthouse at 211 South 
Court Street, Rockford, IL, as the ``Stanley J. Roszkowski United 
States Courthouse.''
  Stanley Roszkowski was raised in Royalton in southern Illinois, one 
of fifteen children. During World War II, he volunteered as a nose 
gunner on a B26 bomber, flying over 25 missions in Italy and Germany. 
After the war he went on to earn his B.A. from the University of 
Illinois and then his law degree, working as an appliance salesman

[[Page 2997]]

to pay for school and meeting his wife Catherine along the way.
  When he moved to Rockford, he opened up a successful law practice and 
became involved in his community. He gave up this practice when 
President Carter appointed him to the bench, serving for the next 20 
years as a Federal Judge in the Northern District of Illinois. He 
became known for running a business-like but relaxed courtroom, and was 
praised by his peers for being extremely knowledgeable, fair and 
objective, and a gentleman at all times, with a wide breadth of 
experience and an uncommon sense of decency. As one lawyer put it: 
``You couldn't ask for a better trial judge.''
  Nobody worked harder than Stanley Roszkowski to make the United 
States Courthouse in Rockford a reality. He spent 6 years commuting 
between Rockford and Chicago building up the case load at Rockford and 
becoming Rockford's first full time Federal judge. As far back as 1992, 
he was writing countless letters and paying numerous visits to federal 
officials in Washington, DC, to make his case. It took many years but 
he never gave up on his belief that if the Federal courts had a 
physical presence in Rockford, it would be welcomed and frequently used 
by the lawyers there. He turned out to be right, and I am pleased that 
Representative Manzullo and I could work together to help secure the 
funding for it.
  Whether in a bomber or on the bench, Stanley Roszkowski has dedicated 
his life to serving his country. I can think of no better way to honor 
his commitment than by naming this Federal courthouse, which he worked 
so tirelessly to see built, after him. I hope my colleagues will join 
me in enacting this tribute to him.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the text of the bill was ordered to be 
placed in the Record, as follows:

                                 S. 387

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

     SECTION 1. STANLEY J. ROSZKOWSKI UNITED STATES COURTHOUSE.

       (a) Designation.--The United States courthouse, located at 
     211 South Court Street, Rockford, Illinois, shall be known 
     and designated as the ``Stanley J. Roszkowski United States 
     Courthouse''.
       (b) References.--Any reference in a law, map, regulation, 
     document, paper, or other record of the United States to the 
     United States courthouse referred to in subsection (a) shall 
     be deemed to be a reference to the ``Stanley J. Roszkowski 
     United States Courthouse''.
                                 ______
                                 
      By Ms. MIKULSKI (for herself, Mr. Specter, Mr. Levin, Mr. Crapo, 
        Mr. Bond, Mr. Lieberman, Mr. Reed, Mr. Kerry, Mr. Enzi, Ms. 
        Collins, Mr. Bennett, Mr. Coburn, Mr. Whitehouse, Mr. Burr, Ms. 
        Snowe, Mr. Leahy, Mr. Carper, Mr. Cardin, Mr. Hatch, and Mr. 
        Barrasso):
  S. 388. A bill to extend the termination date for the exemption of 
returning workers from the numerical limitations for temporary workers; 
to the Committee on the Judiciary.
  Ms. MIKULSKI. Mr. President, today I rise to introduce a bill that is 
needed by small and seasonal businesses all over the nation. In 2005 I 
introduced and the Senate overwhelmingly passed legislation to keep 
these small and seasonal businesses alive. For many years they have 
relied on the H-2B visa program to meet these needs, but this year they 
can't get the temporary labor they need because they have been shut out 
of the H-2B visa program. That program lets them hire temporary foreign 
workers when no American workers are available.
  So today, I join with my colleague Senator Specter to introduce 
legislation that provides a quick and temporary fix to the H-2B 
problem. The Save our Small and Seasonal Businesses Act of 2009 will 
help these employers by extending the H-2B returning worker exemption 
for three years. It does not raise the cap and keeps the limit at 
66,000. I urge my colleagues to work with us to pass this legislation 
quickly to save these businesses and the thousands of American jobs 
they provide.
  Many in this body know about the H-2B crisis--a real crisis to 
thousands of small and seasonal businesses who face a shortage of 
workers as they approach their seasons. These small businesses count on 
the H-2B visa program to keep their businesses afloat. But this year, 
because the cap was reached so early in the year, many of these 
businesses will be unable to get the seasonal workers that they need to 
survive.
  Hitting the cap so early will have a great impact on Maryland. We 
have a lot of summer seasonal businesses in Maryland on the Eastern 
Shore, in Ocean City or working the Chesapeake Bay. Many of our 
businesses use the program year after year. They hire all the American 
workers they can find, but they need additional help to meet seasonal 
demands. Because the cap will be reached so early this year summer 
employers face a disadvantage. They can't use the program, so they 
can't meet their seasonal needs and many will be forced to limit 
services, lay-off permanent U.S. workers or, worse yet, close their 
doors.
  These are family businesses and small businesses in small communities 
in Maryland. If the business suffers the whole community suffers. For 
seafood companies like J.M. Clayton, what they do is more than a 
business, it's a way of life. Started over a century ago and run by the 
great grandsons of the founder, J.M. Clayton works the waters of the 
Chesapeake Bay, supplying crabs, crabmeat and other seafood, including 
Maryland's famous oysters, to restaurants, markets, and wholesalers all 
over the nation. It is the oldest working crab processing plant in the 
world and by employing 70 H-2B workers the company can retain over 50 
full time American workers.
  But its not just seafood companies that have a long history on the 
Eastern Shore. It's companies like S.E.W. Friel Cannery, which began 
its business over 100 years ago when there were 300 canneries on the 
Eastern Shore. But now those others are gone and Friel's is the last 
corn cannery left. Ten years ago, when the cannery could not find local 
workers, it turned to the new H-2B visa Program. It has used the 
program every year since, and many workers are repeat users who come 
each year and then go home after the season. What's important is that 
having this help each year has not only allowed the company to maintain 
its American workforce, but it has paved the way for local workers to 
return to the cannery.
  Now these employers can't just turn to the H-2B program whenever they 
want seasonal workers. First, employers must try to vigorously recruit 
U.S. workers. These businesses try to hire American workers--they would 
love to hire American workers. In fact, the H-2B program requires these 
businesses to prove that they have vigorously tried to recruit American 
workers. They have to advertise for American workers and give American 
workers a chance to apply. They have to prove to the Department of 
Labor that there are no U.S. workers available. Only after that are 
they allowed to fill seasonal vacancies with H-2B visa workers. The 
workers that they bring in often participate in the H-2B program year 
after year. They often work for the same companies. But they cannot and 
do not stay in the U.S. They return to their home countries, to their 
families and their U.S. employer must go through the whole visa process 
again the following year to get them back. That means an employer must 
prove again to the Department of Labor that they cannot get U.S. 
workers.
  This legislative fix keeps that visa process in place. It's a short-
term legislative fix to solve the immediate H-2B visa shortage. It does 
not take the place of comprehensive immigration reform.
  This legislation is a temporary 3 year fix. It exempts returning 
seasonal workers from the cap. These are workers who have already 
successfully participated in the H-2B visa Program. They received a 
visa in one of the past 3 years and have returned home to their 
families after their seasonal employment with a U.S. company.
  Everyone must still play by the rules. Employers must go through the

[[Page 2998]]

whole visa process, prove they need the seasonal help and only after 
that are returning employees exempt from the cap. Employees must be 
those who have left the U.S. and are requesting a new H-2B visa to come 
back for another season. This new system rewards those who have played 
by the rules, worked hard and successfully participated in the program. 
The bill gives a helping hand to businesses by allowing them to retain 
workers who they have already trained to do their seasonal jobs.
  This is a quick and simple fix. It lasts three years. And it does not 
get in the way of comprehensive immigration reform.
  I worked with my colleagues to get a bill with strong bi-partisan 
support. A bill that would work.
  This bill is realistic. It provides a temporary solution because 
immediate action is needed to help these small and seasonal businesses 
stay in business. Yes--we need to help them now. Their seasons start 
soon. If they don't get seasonal workers this year, there may not be 
any businesses around next year to help.
  Every member of the Senate who has heard from their constituents--
whether they are seafood processors, landscapers, resorts, timber 
companies, fisheries, pool companies or carnivals--knows the urgency in 
their voices, knows the immediacy of the problem and knows that the 
Congress must act now to save these businesses. I urge my colleagues to 
join this effort, support the Save our Small and Seasonal Businesses 
Act, and push this Congress to fix the problem today.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                 S. 388

       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 ``Save Our Small and Seasonal 
     Businesses Act of 2009''.

     SEC. 2. EXTENSION OF RETURNING WORKER EXEMPTION TO H-2B 
                   NUMERICAL LIMITATION.

       (a) In General.--Section 214(g)(9)(A) of the Immigration 
     and Nationality Act (8 U.S.C. 1184(g)(9)(A) is amended to 
     read as follows:
       ``(A) Subject to subparagraphs (B) and (C), an alien who 
     has already been counted toward the numerical limitation 
     under paragraph (1)(B) during any 1 of the 3 fiscal years 
     immediately prior to the fiscal year of the approved start 
     date of a petition for a nonimmigrant worker described in 
     section 101(a)(15)(H)(ii)(b) shall not again be counted 
     toward such limitation for the fiscal year for which the 
     petition is approved. Such an alien shall be considered a 
     returning worker.''.
       (b) Effective Date; 3-Year Limitation; Sunset Provision.--
     The amendment made by subsection (a) shall--
       (1) take effect as if enacted on December 1, 2008;
       (2) apply only to petitions with an approved start date in 
     fiscal year 2009, 2010, or 2011; and
       (3) terminate on the date that is 3 years after the date of 
     the enactment of this Act.
                                 ______
                                 
      By Mr. BENNETT:
  S. 389. A bill to establish a conditional stay of the ban on lead in 
children's products, and for `other purposes; to the Committee on 
Commerce, Science, and Transportation.
  Mr. BENNETT. Mr. President, I rise to introduce important legislation 
today.
  Last year, this body passed the Consumer Product Safety Improvement 
Act. Overall, I think this was a good bill, and will contribute to 
improving our children's safety.
  However, as is the case sometimes, we are now learning about some of 
the unintended consequences arising from that legislation. I've heard 
from Utahns who are very concerned that parts of the act are going to 
put them out of business and harm those that benefit from their 
products and services.
  Next week, as part of the Consumer Product Safety Improvement Act, a 
new lead standard for products goes into effect. The act makes it 
illegal to sell products that contain more lead than the new standard 
allows--it classifies those products as banned hazardous substances. 
The new standard should help protect our children from the harmful 
effects of lead poisoning.
  The act also requires manufacturers to use accredited third-party 
laboratories to certify the safety of their products made for children 
ages 12 and under. If you don't test the product, you can't sell it. 
This makes perfect sense.
  But here's the problem: while resellers of those products are exempt 
from the testing requirements of the legislation, they are not exempt 
from the penalties associated with violating the act. Violations can 
result in criminal punishment of up to $250,000 and 5 years in prison, 
and civil liability up to $15 million. All of this is scheduled to go 
into effect on February 10th of this year--less than one week from 
today.
  However, the Consumer Product Safety Commission understands there are 
problems associated with the act. I met with Acting Commissioner Nancy 
Nord last Friday about these issues. We discussed both the act's 
potential problems and the importance of maintaining public safety. 
That same day, her organization postponed the testing and certification 
requirements of the act for one year. They needed additional time to 
finalize the rules, and issue clearer guidance on how businesses should 
comply with the law. Congress gave them the discretion to do this.
  However, and this is the problem, the Consumer Product Safety 
Commission doesn't have the discretion to postpone the actual 
standard--how much lead is legally allowable in certain products. So 
you have a situation where the agency is not enforcing the standard by 
requiring testing and certification while at the same time, the 
companies that have products in their inventory that exceed the lead 
standard are subject to both criminal and civil penalties. As one who 
ran his own business, I can tell you that this makes no sense.
  The legislation that I introduce here today will remedy this seeming 
contradiction. My legislation gives the commission the authority, if it 
determines it's necessary, to also delay implementing the new lead 
standards until they have finalized the rules and begin to enforce the 
law. If the commission were to exercise those authorities, it would 
give both Congress and the Consumer Product Safety Commission enough 
time to really evaluate the effects of this legislation, particularly 
on our small businesses and thrift enterprises, and implement something 
that actually makes sense.
  You must understand that I am not opposed to the new lead standards 
or keeping our children safe. My bill is not mandating a year delay; 
it's simply giving the commission that authority. In the meantime, we 
must craft some sort of compromise before this well-intended law wreaks 
havoc upon many of our small businesses and those in the thrift 
industry that serve the lower income in our country.
  Let me explain some of the problems associated with the CPSIA.
  Some of my constituents who are concerned about this bill are running 
small businesses out of their homes to supplement their family income 
during these difficult economic times. One constituent, Katie Erwin, 
recently wrote to my office to tell me her personal experience. She 
designs and makes baby dresses that are sold on the Internet. Her 
dresses require the use of many fabrics, buttons, snaps, and elastic 
materials. She has done her research into what her business will have 
to do after the CPSIA becomes law. Even though she uses only materials 
that have been proven to have safe lead content, she has to have her 
end product tested. Not just each dress, but each element of each 
dress. At $75 per test, one dress could end up costing $750. She told 
us that, in order to be compliant, the dresses would be so expensive 
that she'd never make a profit. And that is if she could even sell the 
more expensive dresses. Other small and home-based businesses tell the 
same story. Many fear going out of business, and don't know how to cope 
with the new enforcement.
  The Ogden Rescue Mission in northern Utah has two thrift stores that 
have been around for decades selling used goods. The owner has made it 
clear that he will stop selling any children's products on February 10 
because

[[Page 2999]]

he doesn't want to break the law or be held liable for inadvertently 
selling a now-illegal product. Companies risk losing their insurance if 
they accidentally sell an unsafe product. With the new standards 
required by the Consumer Product Safety Improvement Act, the chance of 
that happening is almost certain. I have to believe that larger thrift 
stores like Deseret Industries, the Salvation Army, and Goodwill 
Industries will all have similar concerns once the Act is fully 
understood and implemented.
  Remember, these companies are going to be subject to criminal 
penalties and civilly liable for products they sell that exceed the 
standard, including the resellers whom the law exempts from the testing 
and certification requirements. Again, five years in prison, $250,000 
in criminal penalties and $15 million in civil penalties.
  At a time when we are debating how to stimulate the economy and keep 
businesses afloat, we should not overlook this problem that has the 
potential to cost our economy millions of dollars in litigation costs 
and many, many jobs if it is not implemented in the right way. During 
an economic downturn like the one we are experiencing, thrift stores 
and others that sell used goods are going to be more important than 
ever. Let's make sure they are able to serve our communities by 
providing the commission with the tools necessary to work out the 
problems associated with implementing the CPSIA.
  I hope the Senate expeditiously considers my legislation. I think 
this approach makes sense, and will ultimately help the commission to 
better implement this law. I understand others may have different 
approaches to resolving the same problem, and I would invite a 
discussion of this issue during the coming weeks with my colleagues so 
we can fix it quickly before we do irreparable damage to businesses 
across the country.

                          ____________________