[Congressional Record (Bound Edition), Volume 155 (2009), Part 9]
[House]
[Pages 11829-11839]
[From the U.S. Government Publishing Office, www.gpo.gov]




               FRAUD ENFORCEMENT AND RECOVERY ACT OF 2009

  Mr. SCOTT of Virginia. Mr. Speaker, I move to suspend the rules and 
pass the Senate bill (S. 386) 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, as amended.
  The Clerk read the title of the Senate bill.
  The text of the amendments are as follows:

       Amendments:
       Strike out all after the enacting clause and insert:

                                 S. 386

     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, 
                   COMMODITIES, 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 
     section 3 of the Real Estate Settlement Procedures Act of 
     1974.''.
       (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, or 
     any person or entity that makes in whole or in part a 
     federally related mortgage loan as defined in section 3 of 
     the Real Estate Settlement Procedures Act of 1974''.
       (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 Asset Relief Program, an economic 
     stimulus, recovery or rescue plan provided by the Government, 
     or the Government's purchase of any troubled asset as defined 
     in the Emergency Economic Stabilization Act of 2008, or in'';
       (2) striking ``the contract, subcontract'' and inserting 
     ``such grant, contract, subcontract, subsidy, loan, 
     guarantee, insurance, or other form of Federal assistance''; 
     and
       (3) striking ``for such property or services''.
       (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) in paragraph (1), by inserting ``any commodity for 
     future delivery, or any option on a commodity for future 
     delivery, or'' after ``any person in connection with''; and
       (C) in paragraph (2), by inserting ``any commodity for 
     future delivery, or any option on 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.--
       (1) Money laundering.--Section 1956(c) of title 18, United 
     States Code, is amended--
       (A) in paragraph (8), by striking the period and inserting 
     ``; and''; and
       (B) by inserting at the end the following:
       ``(9) the term `proceeds' means any property derived from 
     or obtained or retained, directly or indirectly, through some 
     form of unlawful activity, including the gross receipts of 
     such activity.''.
       (2) Monetary transactions.--Section 1957(f) of title 18, 
     United States Code, is amended by striking paragraph (3) and 
     inserting the following:
       ``(3) the terms `specified unlawful activity' and 
     `proceeds' shall have the meaning given those terms in 
     section 1956 of this title.''.
       (g) Sense of the Congress and Report Concerning Required 
     Approval for Merger Cases.--
       (1) Sense of congress.--It is the sense of the Congress 
     that no prosecution of an offense under section 1956 or 1957 
     of title 18, United States Code, should be undertaken in 
     combination with the prosecution of any other offense, 
     without prior approval of the Attorney General, the Deputy 
     Attorney General, the Assistant Attorney General in charge of 
     the Criminal Division, a Deputy Assistant Attorney General in 
     the Criminal Division, or the relevant United States 
     Attorney, if the conduct to be charged as ``specified 
     unlawful activity'' in connection with the offense under 
     section 1956 or 1957 is so closely connected with the conduct 
     to be charged as the other offense that there is no clear 
     delineation between the two offenses.
       (2) Report.--One year after the date of the enactment of 
     this Act, and at the end of each of the four succeeding one-
     year periods, the Attorney General shall report to the House 
     and Senate Committees on the Judiciary on efforts undertaken 
     by the Department of Justice to ensure that the review and 
     approval described in paragraph (1) takes place in all 
     appropriate cases. The report shall include the following:
       (A) The number of prosecutions described in paragraph (1) 
     that were undertaken during the previous one-year period 
     after prior approval by an official described in paragraph 
     (1), classified by type of offense and by the approving 
     official.
       (B) The number of prosecutions described in paragraph (1) 
     that were undertaken during the previous one-year period 
     without such prior approval, classified by type of offense, 
     and the reasons why such prior approval was not obtained.
       (C) The number of times during the previous year in which 
     an approval described in paragraph (1) was denied.

     SEC. 3. AUTHORIZATION OF ADDITIONAL FUNDING TO COMBAT 
                   MORTGAGE FRAUD, SECURITIES AND COMMODITIES 
                   FRAUD, AND OTHER FRAUDS INVOLVING FEDERAL 
                   ECONOMIC ASSISTANCE.

       (a) Authorization of Additional Appropriations for the 
     Department of Justice.--
       (1) In general.--There is authorized to be appropriated to 
     the Attorney General, $165,000,000 for each of the fiscal 
     years 2010 and 2011, for the purposes of investigations and 
     prosecutions and civil and administrative 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 amounts authorized to be appropriated under 
     paragraph (1) shall be allocated as follows:
       (A) Federal Bureau of Investigation: $75,000,000 for fiscal 
     year 2010 and $65,000,000 for fiscal year 2011, an 
     appropriate percentage of which amounts shall be used to 
     investigate mortgage fraud.
       (B) The offices of the United States Attorneys: $50,000,000 
     for each fiscal year.
       (C) The criminal division of the Department of Justice: 
     $20,000,000 for each fiscal year.
       (D) The civil division of the Department of Justice: 
     $15,000,000 for each fiscal year.
       (E) The tax division of the Department of Justice: 
     $5,000,000 for each fiscal year.
       (b) Authorization of 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) Authorization of Additional Appropriations for the 
     Inspector General for the Department of Housing and Urban 
     Development.--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) Authorization of Additional Appropriations for the 
     United States Secret Service.--There is authorized to be 
     appropriated to the United States Secret Service of the 
     Department of Homeland Security, $20,000,000 for each of the 
     fiscal years 2010 and 2011 for investigations involving 
     Federal assistance programs and financial institutions, 
     including financial institutions to

[[Page 11830]]

     which this Act and amendments made by this Act apply.
       (e) Authorization of Additional Appropriations for the 
     Securities and Exchange Commission.--
       (1) In general.--There is authorized to be appropriated to 
     the Securities and Exchange Commission, $20,000,000 for each 
     of the fiscal years 2010 and 2011 for investigations and 
     enforcement proceedings involving financial institutions, 
     including financial institutions to which this Act and 
     amendments made by this Act apply.
       (2) Inspector general.--There is authorized to be 
     appropriated to the Securities and Exchange Commission, 
     $1,000,000 for each of the fiscal years 2010 and 2011 for the 
     salaries and expenses of the Office of the Inspector General 
     of the Securities and Exchange Commission.
       (f) Use of Funds.--
       (1) In general.--The funds appropriated pursuant to 
     authorization under this section shall be limited to covering 
     the costs of each listed agency or department for 
     investigating possible criminal, civil, or administrative 
     violations and for criminal, civil, or administrative 
     proceedings involving financial crimes and crimes against 
     Federal assistance programs, including mortgage fraud, 
     securities and commodities fraud, financial institution 
     fraud, and other frauds related to Federal assistance and 
     relief programs.
       (2) Funds for training and research.--Funds authorized to 
     be appropriated under this section may be used and expended 
     for programs for improving the detection, investigation, and 
     prosecution of economic crime including financial fraud and 
     mortgage fraud. Funds allocated under this section may be 
     allocated to programs which assist State and local criminal 
     justice agencies to develop, establish, and maintain 
     intelligence-focused policing strategies and related 
     information sharing; provide training and investigative 
     support services to State and local criminal justice agencies 
     to provide such agencies with skills and resources needed to 
     investigate and prosecute such criminal activities and 
     related criminal activities; provide research support, 
     establish partnerships, and provide other resources to aid 
     State and local criminal justice agencies to prevent, 
     investigate, and prosecute such criminal activities and 
     related problems; provide information and research to the 
     general public to facilitate the prevention of such criminal 
     activities; and any other programs specified by the Attorney 
     General as furthering the purposes of this Act.
       (g) Additional Nature of Authorizations; Availability.--The 
     amounts authorized under this section are in addition to 
     amounts otherwise authorized in other Acts and shall remain 
     available until expended.
       (h) Report to Congress.--Following the final expenditure of 
     all funds appropriated pursuant to authorization under this 
     section, the Attorney General, in consultation with the 
     United States Postal Inspection Service, the Inspector 
     General for the Department of Housing and Urban Development, 
     the Secretary of Homeland Security, and the Commissioner of 
     the Securities and Exchange Commission, shall submit a report 
     to Congress identifying--
       (1) the amounts expended under each of subsections (a), 
     (b), (c), (d), and (e) and a certification of compliance with 
     the requirements listed in subsection (f); and
       (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 material to a false or fraudulent 
     claim;
       ``(C) conspires to commit a violation of subparagraph (A), 
     (B), (D), (E), (F), or (G);
       ``(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 material to an obligation to pay 
     or transmit money or property to the Government, or knowingly 
     conceals or knowingly and improperly 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'--
       ``(A) mean that a person, with respect to information--
       ``(i) has actual knowledge of the information;
       ``(ii) acts in deliberate ignorance of the truth or falsity 
     of the information; or
       ``(iii) acts in reckless disregard of the truth or falsity 
     of the information; and
       ``(B) require no proof of specific intent to defraud;
       ``(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 money or property is to be spent or used on 
     the Government's behalf or to advance a Government program or 
     interest, and 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;
       ``(3) the term `obligation' means an established duty, 
     whether or not fixed, arising from an express or implied 
     contractual, grantor-grantee, or licensor-licensee 
     relationship, from a fee-based or similar relationship, from 
     statute or regulation, or from the retention of any 
     overpayment; and
       ``(4) the term `material' means having a natural tendency 
     to influence, or be capable of influencing, the payment or 
     receipt of money or property.'';
       (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)''.
       (b) Intervention by the Government.--Section 3731(b) of 
     title 31, United States Code, is amended--
       (1) by redesignating subsection (c) as subsection (d);
       (2) by redesignating subsection (d) as subsection (e); and
       (3) by inserting the new subsection (c):
       ``(c) If the Government elects to intervene and proceed 
     with an action brought under 3730(b), the Government may file 
     its own complaint or amend the complaint of a person who has 
     brought an action under section 3730(b) to clarify or add 
     detail to the claims in which the Government is intervening 
     and to add any additional claims with respect to which the 
     Government contends it is entitled to relief. For statute of 
     limitations purposes, any such Government pleading shall 
     relate back to the filing date of the complaint of the person 
     who originally brought the action, to the extent that the 
     claim of the Government arises out of the conduct,

[[Page 11831]]

     transactions, or occurrences set forth, or attempted to be 
     set forth, in the prior complaint of that person.''.
       (c) Civil Investigative Demands.--Section 3733 of title 31, 
     United States Code, is amended--
       (1) in subsection (a)--
       (A) in paragraph (1)--
       (i) in the matter preceding subparagraph (A)--

       (I) by inserting ``, or a designee (for purposes of this 
     section),'' after ``Whenever the Attorney General''; and
       (II) by striking ``the Attorney General may, before 
     commencing a civil proceeding under section 3730 or other 
     false claims law,'' and inserting ``the Attorney General, or 
     a designee, may, before commencing a civil proceeding under 
     section 3730(a) or other false claims law, or making an 
     election under section 3730(b),''; and

       (ii) in the matter following subparagraph (D)--

       (I) by striking ``may not delegate'' and inserting ``may 
     delegate''; and
       (II) by adding at the end the following: ``Any information 
     obtained by the Attorney General or a designee of the 
     Attorney General under this section may be shared with any 
     qui tam relator if the Attorney General or designee determine 
     it is necessary as part of any false claims act 
     investigation.''; and

       (B) in paragraph (2)(G), by striking the second sentence;
       (2) in subsection (i)(2)--
       (A) in subparagraph (B), by striking ``, who is authorized 
     for such use under regulations which the Attorney General 
     shall issue''; and
       (B) in subparagraph (C), by striking ``Disclosure of 
     information to any such other agency shall be allowed only 
     upon application, made by the Attorney General to a United 
     States district court, showing substantial need for the use 
     of the information by such agency in furtherance of its 
     statutory responsibilities.''; and
       (3) in subsection (l)--
       (A) in paragraph (6), by striking ``and'' after the 
     semicolon;
       (B) in paragraph (7), by striking the period and inserting 
     ``; and''; and
       (C) by adding at the end the following:
       ``(8) the term `official use' means any use that is 
     consistent with the law, and the regulations and policies of 
     the Department of Justice, including use in connection with 
     internal Department of Justice memoranda and reports; 
     communications between the Department of Justice and a 
     Federal, State, or local government agency, or a contractor 
     of a Federal, State, or local government agency, undertaken 
     in furtherance of a Department of Justice investigation or 
     prosecution of a case; interviews of any qui tam relator or 
     other witness; oral examinations; depositions; preparation 
     for and response to civil discovery requests; introduction 
     into the record of a case or proceeding; applications, 
     motions, memoranda and briefs submitted to a court or other 
     tribunal; and communications with Government investigators, 
     auditors, consultants and experts, the counsel of other 
     parties, arbitrators and mediators, concerning an 
     investigation, case or proceeding.''.
       (d) Relief From Retaliatory Actions.--Section 3730(h) of 
     title 31, United States Code, is amended to read as follows:
       ``(h) Relief From Retaliatory Actions.--
       ``(1) In general.--Any employee, contractor, or agent shall 
     be entitled to all relief necessary to make that employee, 
     contractor, or agent whole, if that employee, contractor, or 
     agent is discharged, demoted, suspended, threatened, 
     harassed, or in any other manner discriminated against in the 
     terms and conditions of employment because of lawful acts 
     done by the employee, contractor, or agent on behalf of the 
     employee, contractor, or agent or associated others in 
     furtherance of other efforts to stop 1 or more violations of 
     this subchapter.
       ``(2) Relief.--Relief under paragraph (1) shall include 
     reinstatement with the same seniority status that employee, 
     contractor, or agent would have had but for the 
     discrimination, 2 times the amount of back pay, interest on 
     the back pay, and compensation for any special damages 
     sustained as a result of the discrimination, including 
     litigation costs and reasonable attorneys' fees. An action 
     under this subsection may be brought in the appropriate 
     district court of the United States for the relief provided 
     in this subsection.''.
       (e) False Claims Jurisdiction.--Section 3732 of title 31, 
     United States Code, is amended by adding at the end the 
     following new subsection:
       ``(c) Service on State or Local Authorities.--With respect 
     to any State or local government that is named as a co-
     plaintiff with the United States in an action brought under 
     subsection (b), a seal on the action ordered by the court 
     under section 3730(b) shall not preclude the Government or 
     the person bringing the action from serving the complaint, 
     any other pleadings, or the written disclosure of 
     substantially all material evidence and information possessed 
     by the person bringing the action on the law enforcement 
     authorities that are authorized under the law of that State 
     or local government to investigate and prosecute such actions 
     on behalf of such governments, except that such seal applies 
     to the law enforcement authorities so served to the same 
     extent as the seal applies to other parties in the action.''.
       (f) Effective Date and Application.--The amendments made by 
     this section shall take effect on the date of enactment of 
     this Act and shall apply to conduct on or after the date of 
     enactment, except that--
       (1) subparagraph (B) of section 3729(a)(1) of title 31, 
     United States Code, as added by subsection (a)(1), shall take 
     effect as if enacted on June 7, 2008, and apply to all claims 
     under the False Claims Act (31 U.S.C. 3729 et seq.) that are 
     pending on or after that date; and
       (2) section 3731(b) of title 31, as amended by subsection 
     (b); section 3733, of title 31, as amended by subsection (c); 
     and section 3732 of title 31, as amended by subsection (e); 
     shall apply to cases pending on the date of enactment.

     SEC. 5. FINANCIAL CRISIS INQUIRY COMMISSION.

       (a) Establishment of Commission.--There is established in 
     the legislative branch the Financial Crisis Inquiry 
     Commission (in this section referred to as the 
     ``Commission'') to examine the causes, domestic and global, 
     of the current financial and economic crisis in the United 
     States.
       (b) Composition of the Commission.--
       (1) Members.--The Commission shall be composed of 10 
     members, of whom--
       (A) 3 members shall be appointed by the majority leader of 
     the Senate, in consultation with relevant Committees;
       (B) 3 members shall be appointed by the Speaker of the 
     House of Representatives, in consultation with relevant 
     Committees;
       (C) 2 members shall be appointed by the minority leader of 
     the Senate, in consultation with relevant Committees; and
       (D) 2 members shall be appointed by the minority leader of 
     the House of Representatives, in consultation with relevant 
     Committees.
       (2) Qualifications; limitation.--
       (A) In general.--It is the sense of the Congress that 
     individuals appointed to the Commission should be prominent 
     United States citizens with national recognition and 
     significant depth of experience in such fields as banking, 
     regulation of markets, taxation, finance, economics, consumer 
     protection, and housing.
       (B) Limitation.--No person who is a member of Congress or 
     an officer or employee of the Federal Government or any State 
     or local government may serve as a member of the Commission.
       (3) Chairperson; vice chairperson.--
       (A) In general.--Subject to the requirements of 
     subparagraph (B), the Chairperson of the Commission shall be 
     selected jointly by the Majority Leader of the Senate and the 
     Speaker of the House of Representatives, and the Vice 
     Chairperson shall be selected jointly by the Minority Leader 
     of the Senate and the Minority Leader of the House of 
     Representatives.
       (B) Political party affiliation.--The Chairperson and Vice 
     Chairperson of the Commission may not be from the same 
     political party.
       (4) Meetings, quorum; vacancies.--
       (A) Meetings.--
       (i) Initial meeting.--The initial meeting of the Commission 
     shall be as soon as possible after a quorum of members have 
     been appointed.
       (ii) Subsequent meetings.--After the initial meeting of the 
     Commission, the Commission shall meet upon the call of the 
     Chairperson or a majority of its members.
       (B) Quorum.--6 members of the Commission shall constitute a 
     quorum.
       (C) Vacancies.--Any vacancy on the Commission shall--
       (i) not affect the powers of the Commission; and
       (ii) be filled in the same manner in which the original 
     appointment was made.
       (c) Functions of the Commission.--The functions of the 
     Commission are--
       (1) to examine the causes of the current financial and 
     economic crisis in the United States, specifically the role 
     of--
       (A) fraud and abuse in the financial sector, including 
     fraud and abuse towards consumers in the mortgage sector;
       (B) Federal and State financial regulators, including the 
     extent to which they enforced, or failed to enforce 
     statutory, regulatory, or supervisory requirements;
       (C) the global imbalance of savings, international capital 
     flows, and fiscal imbalances of various governments;
       (D) monetary policy and the availability and terms of 
     credit;
       (E) accounting practices, including, mark-to-market and 
     fair value rules, and treatment of off-balance sheet 
     vehicles;
       (F) tax treatment of financial products and investments;
       (G) capital requirements and regulations on leverage and 
     liquidity, including the capital structures of regulated and 
     non-regulated financial entities;
       (H) credit rating agencies in the financial system, 
     including, reliance on credit ratings by financial 
     institutions and Federal financial regulators, the use of 
     credit ratings in financial regulation, and the use of credit 
     ratings in the securitization markets;
       (I) lending practices and securitization, including the 
     originate-to-distribute model for extending credit and 
     transferring risk;
       (J) affiliations between insured depository institutions 
     and securities, insurance, and other types of nonbanking 
     companies;

[[Page 11832]]

       (K) the concept that certain institutions are ``too-big-to-
     fail'' and its impact on market expectations;
       (L) corporate governance, including the impact of company 
     conversions from partnerships to corporations;
       (M) compensation structures;
       (N) changes in compensation for employees of financial 
     companies, as compared to compensation for others with 
     similar skill sets in the labor market;
       (O) the legal and regulatory structure of the United States 
     housing market;
       (P) derivatives and unregulated financial products and 
     practices, including credit default swaps;
       (Q) short-selling;
       (R) financial institution reliance on numerical models, 
     including risk models and credit ratings;
       (S) the legal and regulatory structure governing financial 
     institutions, including the extent to which the structure 
     creates the opportunity for financial institutions to engage 
     in regulatory arbitrage;
       (T) the legal and regulatory structure governing investor 
     and mortrgagor protection;
       (U) financial institutions and government-sponsored 
     enterprises; and
       (V) the quality of due diligence undertaken by financial 
     institutions;
       (2) to examine the causes of the collapse of each major 
     financial institution that failed (including institutions 
     that were acquired to prevent their failure) or was likely to 
     have failed if not for the receipt of exceptional Government 
     assistance from the Secretary of the Treasury during the 
     period beginning in August 2007 through April 2009;
       (3) to submit a report under subsection (h);
       (4) to refer to the Attorney General of the United States 
     and any appropriate State attorney general any person that 
     the Commission finds may have violated the laws of the United 
     States in relation to such crisis; and
       (5) to build upon the work of other entities, and avoid 
     unnecessary duplication, by reviewing the record of the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate, the Committee on Financial Services of the House of 
     Representatives, other congressional committees, the 
     Government Accountability Office, other legislative panels, 
     and any other department, agency, bureau, board, commission, 
     office, independent establishment, or instrumentality of the 
     United States (to the fullest extent permitted by law) with 
     respect to the current financial and economic crisis.
       (d) Powers of the Commission.--
       (1) Hearings and evidence.--The Commission may, for 
     purposes of carrying out this section--
       (A) hold hearings, sit and act at times and places, take 
     testimony, receive evidence, and administer oaths; and
       (B) require, by subpoena or otherwise, the attendance and 
     testimony of witnesses and the production of books, records, 
     correspondence, memoranda, papers, and documents.
       (2) Subpoenas.--
       (A) Service.--Subpoenas issued under paragraph (1)(B) may 
     be served by any person designated by the Commission.
       (B) Enforcement.--
       (i) In general.--In the case of contumacy or failure to 
     obey a subpoena issued under paragraph (1)(B), the United 
     States district court for the judicial district in which the 
     subpoenaed person resides, is served, or may be found, or 
     where the subpoena is returnable, may issue an order 
     requiring such person to appear at any designated place to 
     testify or to produce documentary or other evidence. Any 
     failure to obey the order of the court may be punished by the 
     court as a contempt of that court.
       (ii) Additional enforcement.--Sections 102 through 104 of 
     the Revised Statutes of the United States (2 U.S.C. 192 
     through 194) shall apply in the case of any failure of any 
     witness to comply with any subpoena or to testify when 
     summoned under the authority of this section.
       (iii) Issuance.--A subpoena may be issued under this 
     subsection only--

       (I) by the agreement of the Chairperson and the Vice 
     Chairperson; or
       (II) by the affirmative vote of a majority of the 
     Commission, a majority being present.

       (3) Contracting.--The Commission may enter into contracts 
     to enable the Commission to discharge its duties under this 
     section.
       (4) Information from federal agencies and other entities.--
       (A) In general.--The Commission may secure directly from 
     any department, agency, bureau, board, commission, office, 
     independent establishment, or instrumentality of the United 
     States any information related to any inquiry of the 
     Commission conducted under this section, including 
     information of a confidential nature (which the Commission 
     shall maintain in a secure manner). Each such department, 
     agency, bureau, board, commission, office, independent 
     establishment, or instrumentality shall furnish such 
     information directly to the Commission upon request.
       (B) Other entities.--It is the sense of the Congress that 
     the Commission should seek testimony or information from 
     principals and other representatives of government agencies 
     and private entities that were significant participants in 
     the United States and global financial and housing markets 
     during the time period examined by the Commission.
       (5) Administrative support services.--Upon the request of 
     the Commission--
       (A) the Administrator of General Services shall provide to 
     the Commission, on a reimbursable basis, the administrative 
     support services necessary for the Commission to carry out 
     its responsibilities under this Act; and
       (B) other Federal departments and agencies may provide to 
     the Commission any administrative support services as may be 
     determined by the head of such department or agency to be 
     advisable and authorized by law.
       (6) Donations of goods and services.--The Commission may 
     accept, use, and dispose of gifts or donations of services or 
     property.
       (7) Postal services.--The Commission may use the United 
     States mails in the same manner and under the same conditions 
     as departments and agencies of the United States.
       (8) Powers of subcommittees, members, and agents.--Any 
     subcommittee, member, or agent of the Commission may, if 
     authorized by the Commission, take any action which the 
     Commission is authorized to take by this section.
       (e) Staff of the Commission.--
       (1) Director.--The Commission shall have a Director who 
     shall be appointed by the Chairperson and the Vice 
     Chairperson, acting jointly.
       (2) Staff.--The Chairperson and the Vice Chairperson may 
     jointly appoint additional personnel, as may be necessary, to 
     enable the Commission to carry out its functions.
       (3) Applicability of certain civil service laws.--The 
     Director and staff of the Commission may be appointed without 
     regard to the provisions of title 5, United States Code, 
     governing appointments in the competitive service, and may be 
     paid without regard to the provisions of chapter 51 and 
     subchapter III of chapter 53 of such title relating to 
     classification and General Schedule pay rates, except that no 
     rate of pay fixed under this paragraph may exceed the 
     equivalent of that payable for a position at level V of the 
     Executive Schedule under section 5316 of title 5, United 
     States Code. Any individual appointed under paragraph (1) or 
     (2) shall be treated as an employee for purposes of chapters 
     63, 81, 83, 84, 85, 87, 89, 89A, 89B, and 90 of that title.
       (4) Detailees.--Any Federal Government employee may be 
     detailed to the Commission without reimbursement from the 
     Commission, and such detailee shall retain the rights, 
     status, and privileges of his or her regular employment 
     without interruption.
       (5) Consultant services.--The Commission is authorized to 
     procure the services of experts and consultants in accordance 
     with section 3109 of title 5, United States Code, but at 
     rates not to exceed the daily rate paid a person occupying a 
     position at level IV of the Executive Schedule under section 
     5315 of title 5, United States Code.
       (f) Compensation and Travel Expenses.--
       (1) Compensation.--Each member of the Commission may be 
     compensated at a rate not to exceed the daily equivalent of 
     the annual rate of basic pay in effect for a position at 
     level IV of the Executive Schedule under section 5315 of 
     title 5, United States Code, for each day during which that 
     member is engaged in the actual performance of the duties of 
     the Commission.
       (2) Travel expenses.--While away from their homes or 
     regular places of business in the performance of services for 
     the Commission, members of the Commission shall be allowed 
     travel expenses, including per diem in lieu of subsistence, 
     in the same manner as persons employed intermittently in the 
     Government service are allowed expenses under section 5703(b) 
     of title 5, United States Code.
       (g) Nonapplicability of Federal Advisory Committee Act.--
     The Federal Advisory Committee Act (5 U.S.C. App.) shall not 
     apply to the Commission.
       (h) Report of the Commission; Appearance Before and 
     Consultations With Congress.--
       (1) Report.--On December 15, 2010, the Commission shall 
     submit to the President and to the Congress a report 
     containing the findings and conclusions of the Commission on 
     the causes of the current financial and economic crisis in 
     the United States.
       (2) Institution-specific reports authorized.--At the 
     discretion of the chairperson of the Commission, the report 
     under paragraph (1) may include reports or specific findings 
     on any financial institution examined by the Commission under 
     subsection (c)(2).
       (3) Appearance before the congress.--The chairperson of the 
     Commission shall, not later than 120 days after the date of 
     submission of the final reports under paragraph (1), appear 
     before the Committee on Banking, Housing, and Urban Affairs 
     of the Senate and the Committee on Financial Services of the 
     House of Representatives regarding such reports and the 
     findings of the Commission.
       (4) Consultations with the congress.--The Commission shall 
     consult with the Committee on Banking, Housing, and Urban 
     Affairs of the Senate, the Committee on Financial Services of 
     the House of Representatives, and other relevant committees 
     of the

[[Page 11833]]

     Congress, for purposes of informing the Congress on the work 
     of the Commission.
       (i) Termination of Commission.--
       (1) In general.--The Commission, and all the authorities of 
     this section, shall terminate 60 days after the date on which 
     the final report is submitted under subsection (h).
       (2) Administrative activities before termination.--The 
     Commission may use the 60-day period referred to in paragraph 
     (1) for the purpose of concluding the activities of the 
     Commission, including providing testimony to committees of 
     the Congress concerning reports of the Commission and 
     disseminating the final report submitted under subsection 
     (h).
       (j) Authorization of Appropriation.--There is authorized to 
     be appropriated to the Secretary of the Treasury such sums as 
     are necessary to cover the costs of the Commission.
       Amend the title so as to read: ``An Act to improve 
     enforcement of mortgage fraud, securities and commodities 
     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.''.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Virginia (Mr. Scott) and the gentleman from California (Mr. Issa) each 
will control 20 minutes.
  The Chair recognizes the gentleman from Virginia.


                             General Leave

  Mr. SCOTT of Virginia. Mr. Speaker, I ask unanimous consent that all 
Members may have 5 legislative days to revise and extend their remarks 
and include extraneous material on the bill under consideration.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Virginia?
  There was no objection.
  Mr. SCOTT of Virginia. I yield myself such time as I may consume.
  The Fraud Enforcement and Recovery Act of 2009 is crafted to combat 
financial fraud that contributed to causing and worsening our Nation's 
current economic crisis. We are bringing to the floor a bill that 
represents a consensus of efforts for the House and Senate, each acting 
on a bipartisan basis, blending the Senate-passed bill with H.R. 1748, 
the Fight Fraud Act of 2009, which the House Judiciary Committee 
reported last week.
  This bill amends the Federal criminal fraud statutes to reach the 
full range of fraud and other financial crimes that have come to light 
as the financial crisis has unfolded. The bill amends the definition of 
``financial institution'' and fraud statutes to make it clear that 
financial institutions include mortgage lending businesses. It amends 
the securities fraud statute to make it clear that securities fraud 
includes commodities fraud. It makes it clear that it is a felony for a 
mortgage broker to knowingly make a materially false statement on a 
loan application or fraudulently overvalue property in order to 
influence any action by a mortgage lending business. Of course, that is 
already a crime, and the bill clearly states this fact just in case 
anybody thought it was okay to cheat and defraud a mortgage lending 
business during the mortgage process.
  It amends Federal money laundering statutes to make them more 
effective in the context of fraud prosecutions and to ensure their 
appropriate use. It also seeks to deter fraud from undermining the TARP 
and economic stimulus package efforts recently passed by explicitly 
making fraud in those cases a felony.
  In addition to amending criminal statutes, S-386 clarifies key 
provisions of the False Claims Act in order to more effectively enlist 
private citizens in helping root out fraud against the government and 
bring its perpetrators to justice.
  Now, Mr. Speaker, I think the most important part of the bill, in my 
judgment, is not the clarification of various fraud sections in the 
criminal code, but its authorization of resources to investigate and 
prosecute fraudulent activities. Additional authorization for the FBI, 
for example, would enable it to nearly double the size of its mortgage 
and financial fraud program. The U.S. Attorneys offices and other 
components of the Justice Department and other Federal agencies 
involved in investigating fraud would also receive increased 
authorizations. Additional funds provided pursuant to the new 
authorizations can be used not only for Federal investigations and 
enforcement, but also to support State and local law enforcement 
efforts in this area, including training, technical assistance, 
expertise and other support provided through programs such as the 
National White Collar Crime Center.
  Mr. Speaker, many financial crimes today go unpunished because law 
enforcement agencies simply lack the resources to investigate and 
prosecute financial crimes such as ID theft, mortgage fraud or 
organized retail theft. This bill will empower Federal law enforcement 
officials to hold criminals accountable for their crimes.
  And finally, Mr. Speaker, the bill incorporates legislation by the 
gentleman from Connecticut (Mr. Larson) which will create an 
independent, bipartisan commission with subpoena power to examine more 
broadly the circumstances giving rise to the current financial crisis.
  I would like to commend the Judiciary Committee's chairman, the 
gentleman from Michigan (Mr. Conyers), the ranking member, the 
gentleman from Texas (Mr. Smith), the ranking member of the 
subcommittee, the gentleman from Texas (Mr. Gohmert) and others on the 
committee, as well as the gentlelady from Illinois (Mrs. Biggert) and 
our colleagues from the other body for their help in making this such a 
strong bipartisan bill. I urge my colleagues to support it.
  I reserve the balance of my time.
  Mr. ISSA. At this time, I would like to yield 3 minutes to the 
gentlewoman from Illinois (Mrs. Biggert) for her statement.
  Mrs. BIGGERT. I thank the gentleman for yielding and thank him for 
managing the bill. I would also like to thank Chairman Conyers, Ranking 
Member Smith and their staffs, in particular Caroline Lynch, Allison 
Hallataei, Zachary Somers, Rob Reed, and my designee for the Financial 
Services, Nicole Austin, for their work on this bill, Senate 386, the 
Fraud Enforcement and Recovery Act.
  I urge my colleagues to support this amended version.
  I was pleased to be an original co-sponsor of the House version of 
this bill, H.R. 1748, the Fight Fraud Act, which is the substitute 
language to the underlying bill. I am also pleased that the bill 
includes language from my bill, H.R. 78, the Stop Mortgage Fraud Act, 
to provide additional funds to the FBI and Department of Justice to 
investigate and prosecute mortgage fraud.
  A couple of years ago, the Chicago Tribune published a series that 
revealed that gangs in the Chicago area were increasingly turning 
toward mortgage fraud. They found it more lucrative than selling drugs. 
It turns out the gangs were not alone. Everyone, it seems, was in on 
the act.
  In March, the U.S. Attorney in Chicago, Patrick Fitzgerald, brought 
mortgage fraud indictments against two dozen players. They are brokers, 
accountants, loan officers and processors and attorneys.
  Mortgage fraud comes in all shapes and sizes. Scam artists inflated 
appraisals, flipped properties and lied about information, including 
income and identity, on loan applications. Some used the identity of 
deceased people to obtain mortgages. And other desperate thieves bilked 
out of their homes and home equity the most vulnerable homeowners and 
seniors in dire financial straits.
  Let's face it: This is just the tip of the iceberg, which is why H.R. 
1728, the mortgage reform bill, also under consideration today, is an 
important bill. And as we in Congress work to get the economy back on 
track and credit flowing again, we have to address what was the root of 
the mortgage meltdown in the first place, mortgage fraud.

                              {time}  1430

  Mortgage fraud continues to rise in record numbers. The FBI has 
reported that in 5 years, the mortgage fraud caseload increased 237 
percent, and investigations more than doubled in 3 years, reaching over 
63,000 reports in 2008. For the fifth year in a row, Illinois secured a 
spot, number three this year, on the top 10 list of States with the 
most severe and prevalent incidents of mortgage fraud.

[[Page 11834]]

  As a former real estate attorney and member of the House Financial 
Services Committee, I have seen firsthand the devastating effect of 
mortgage fraud. It has plagued our financial system and economy. Most 
tragically, it has cost millions of Americans families their homes and 
required taxpayers to commit trillions of their hard-earned dollars to 
prop up the financial industry. It is not fair to the good actors in 
the industry and the 90 percent of homeowners who are paying their 
mortgages on time.
  Congress can help to inject certainty and fairness into the mortgage 
system--to restore investor, homeowner, and public confidence in the 
American Dream and our financial system.
  As we work to modernize financial laws and regulations, it is our 
duty to supply Federal law enforcement with the tools and resources it 
needs to rapidly tackle fraud, particularly mortgage fraud. Fighting 
fraud must play a central role in solving the underlying problems that 
have undermined economic recovery.
  With that, I urge my colleagues to support this amended version of 
Senate 386.
  Mr. SCOTT of Virginia. Mr. Speaker, I yield such time as he may 
consume to the gentleman from Connecticut, the chairman of the majority 
caucus, Mr. Larson.
  Mr. LARSON of Connecticut. I want to start by thanking Speaker 
Pelosi, Congressman Frank, and Senator Dodd for their tireless work on 
this effort, as well as Congressman Conyers, and also thank and point 
out the work of Congressman Issa and his staff in working in 
conjunction on this.
  The American people have been demanding answers about the collapse of 
our financial system. Today, this House votes on legislation to finally 
get to those answers. Shortly after our financial system began to show 
signs of collapse back in September, like many Members here, I went 
home to my district. I stopped by Augie and Ray's, which for me is 
where it begins and ends in my hometown in East Hartford. People simply 
have one question: How did this happen?
  The questions I heard were no doubt similar to what my colleagues 
heard all across this Nation. Unfortunately, the answer is not so 
simple. Most Americans do not know what a credit default swap is, what 
derivatives are, or what naked short selling is all about. I could go 
on.
  But they do know that their savings are dwindling. They have lost 
their jobs, their homes, and in many cases their health care as well. 
And they rightly want and demand an explanation as to why. I knew then 
that we needed a commission to provide answers and a narrative for the 
American people, and one, frankly, for the Congress as we move ahead 
with commonsense reforms to make sure this doesn't happen again.
  Our economy has suffered through the bursting of three major economic 
bubbles: the savings and loan debacle of the 1980s, the dot.com bubble 
of the 1990s, and now the real estate bubble. It is time we learned 
something from these crises.
  Our Nation faced a similar challenge after the stock market crash of 
1929. Congress formed a panel, the Pecora Commission, that uncovered 
the fraudulent and unscrupulous activities that brought about the Great 
Depression and laid the groundwork for the regulation that has served 
this Nation for decades.
  It is time in this century for a new commission to help develop the 
framework of a modern regulatory structure for the 21st-century global 
economy.
  Americans have lost their homes, their jobs, their life savings. We 
owe them not only an explanation of how this happened, but a path 
forward that corrects the circumstances that created the crisis.
  We have got to do this by looking back not just conveniently over the 
last 8 years, but at the last 28 years. And as Pecora said, ``We must 
shed the fierce light of public scrutiny'' on the dark markets, on the 
schemes and negligence, and the unintended consequences that have been 
perpetrated on our financial system. Why? So we can build a regulatory 
framework for this century that protects the American worker and that 
protects the American investor.
  Mr. ISSA. Mr. Speaker, as I recognize the former chairman of the full 
Committee on the Judiciary, I would like to thank the gentleman from 
Connecticut for his bipartisan work on coming to an agreement between 
our two bills that I believe led to the suspension today on the Senate 
bill.
  With that, I yield 3 minutes to the gentleman from Wisconsin (Mr. 
Sensenbrenner).
  Mr. SENSENBRENNER. Mr. Speaker, I thank the gentleman from California 
for yielding to me.
  I rise in support today of S. 386, the Fraud Enforcement Recovery Act 
of 2009. I am particularly pleased that the bill amends certain 
provisions of the False Claims Act, which allows private individuals 
with knowledge of past or present fraud committed against the 
government to file claims against Federal contractors. We need the 
False Claims Act, as it is the principal tool of law enforcement to 
combat fraud against Federal programs.
  The False Claims Act was originally passed at the behest of President 
Lincoln during the Civil War to combat fraud against the Union Army. 
The act has been amended several times since then, with President 
Reagan signing the most recent bill in 1986, and an update is overdue.
  The False Claims Act has been successful for the Federal Government. 
It has returned more than $20 billion in settlements and judgments to 
the U.S. Treasury over the past 20 years.
  Although the False Claims Act has been successful, there is always 
room for improvement. Several Federal courts have applied and 
interpreted provisions of the FCA in ways that have substantially 
weakened the law. This bill changes that.
  Congress recently approved a $787 billion stimulus package. As many 
of us know, the Federal Government itself will not dole out all of this 
money, but will rely on government contractors, grantees, and other 
third parties to distribute a large portion of these funds.
  With the U.S. Government relying on private contractors to disburse 
funds for everything from our Medicare prescription drug program to our 
war efforts in Iraq to the stimulus money, billions of Federal dollars 
are now in jeopardy. The bailouts that Congress is approving left and 
right, without proper transparency or accountability, only adds to the 
amount of government funds in jeopardy from the fraudsters.
  It is my hope that the House passes additional false claims 
provisions this year so that fraudsters will no longer be able to hide 
behind judicially created qualifications and evade liability. 
Especially in these challenging times, there is no patience for 
individuals making false claims and benefiting from them.
  Although all of the provisions of the False Claims Corrections Act, 
which I introduced with the gentleman from California (Mr. Berman), 
were not included in this legislation, I am pleased that some were 
added. This is a good start, and I look forward to working with my 
colleagues to enact the rest of those provisions.
  Mr. SCOTT of Virginia. Mr. Speaker, I now yield such time as she may 
consume to a member of the Judiciary Committee, the gentlewoman from 
Texas (Ms. Jackson-Lee).
  Ms. JACKSON-LEE of Texas. Mr. Speaker, I thank the distinguished 
chairman and I thank the Speaker.
  Mr. Speaker, whenever we attended to matters in our district over the 
last year, when many of our constituents are facing the most 
catastrophic time in their life, it may be a catastrophic illness or a 
personal matter that changes or skews their whole life-style. We are 
seeing the financial markets and the structure of financial calamity 
alter the lives of Americans.
  I think it is important to note that this Congress, this new 
Congress, has made an effort step by step to respond to the needs of 
Americans. I thank Mr. Issa for his work and that of our full committee 
and the leadership of the Senate to bring us S. 386 which amends the 
Federal criminal fraud statutes to reach the full range of fraud and 
other

[[Page 11835]]

financial crimes that have come to light as the financial crisis has 
unfolded.
  It is important for America to know that we will hold those 
accountable for the malfeasance and the criminal acts that they have 
engaged in; for example, the Bernie Madoff issue, with so many people 
losing not only their sole possessions and resources, but in essence 
some would say losing their lives.
  This amends the security fraud statute to include commodities fraud. 
It clarifies that it is a felony for a mortgage banker to knowingly 
make materially false statements on a loan application or overvalue 
property. We can attest to the fact that this has happened.
  And in keeping with that, I am also supportive of H.R. 1728, that is, 
the Mortgage Reform and Anti-Predatory Lending Act.
  For those of us at town hall meetings and who have listened to any 
number of those who are in foreclosure, they told us that they would 
see papers that they had signed come back with the altering of their 
rates, with the altering of their income, with the altering of certain 
vital points that would then, in essence, put this fraudulent document 
in a position for the individual to receive a loan on false premises. 
Therein lies the underpinnings, if you will, of this collapse; the 
overexerting, if you will, of the market by lending to people who could 
not afford the homes, by miswriting on the documents. All of this came 
about.
  In the mortgage bill that we will be discussing over the next 24 
hours, I was glad to argue on the point of language dealing with 
predatory lending which is also covered in S. 386, as we have 
indicated, and as well to provide an amendment that provides for an 
individual knowing how much their mortgage and interest would cost over 
a period of time. It is all right to be able to go in and fill out 
papers that indicate that you have a down payment of $2,000, but it is 
another thing to know that you are buying a house for a million dollars 
or $5 million, or more over a period of your lifetime, and whether or 
not that individual, that particular purchaser, understands the facts 
in the documents before them.
  The bill that we have before us amends Federal money laundering 
statutes to make them more effective in the context of fraud, 
prosecutions and ensures their appropriate use, and explicitly made 
fraud against the TARP and economic stimulus programs also a felony.
  There is a lot of money out there, Mr. Speaker, and there is 
certainly the possibility that all of those moneys can be used in a 
fraudulent manner.
  I believe it is important for the Members of this body but also the 
American people to know that we are working. And I also add in 
conclusion, Mr. Speaker, we are doing a lot of good work today. I also 
support the legislation, H. Res. 14, that acknowledges the importance 
of the Border Patrol in combating human trafficking. I am working to 
ensure that they have extra language to help them with additional 
Border Patrol agents and also to fight the guns and drugs that have a 
lot to do with human smuggling. The American people need to know the 
work that we are doing.
  I am in support of S. 386 because it puts a pin in the balloon of 
fraud that has hurt so many people. I would ask my colleagues to 
support this legislation.
  Mr. Speaker, I rise in strong support of S. 386, Fraud Enforcement 
and Recovery Act that was introduced in this Congress by the Chairman 
of the Judiciary Committee, Representative John Conyers from Michigan. 
This timely legislative initiative is aimed at fighting fraud and 
protecting taxpayers. If passed, this bill will help Americans recover 
from the present economic crisis. I urge my colleagues to support this 
bill.
  This legislation is designed to combat fraud by increasing vigilance 
and accountability concerning the manner how American tax dollars are 
spent. The types of fraud covered by this legislation include financial 
fraud, corporate fraud, contracting fraud, and mortgage fraud.
  Because recent history has demonstrated that large government outlays 
of money has attracted persons attempting to create fraud, this 
legislation provides the Congress with the opportunity to identify 
viable solutions to fraud and misuse.
  Current federal law enforcement uses a number of criminal statutes to 
prosecute fraud. The criminal penalties for fraud are found in Title 18 
of the United States Code. This bill extend the application of these 
penalties to new areas.
  Specifically, this bill will increase accountability for corporate 
and mortgage fraud and will safeguard against future fraud on those 
programs that Congress recently developed to restore America's economy. 
This bill provides increased funding for the expanded role of the 
Department of Justice. Financial institutions, mortgage lenders, and 
other private entities are held accountable. This bill will target face 
statements made to financial institutions and false statements made by 
financial institutions, i.e. in the overvaluation of property.
  H.R. 1292, To amend Title I of the Omnibus Crime Control and Safe 
Streets Act of 1968, establishes a grant program to authorize funds to 
states to work with information sharing and training programs focused 
upon the prevention, investigation, and prosecution of terrorism, 
economic and high-tech crimes and will aid in the creation and 
maintenance of intelligence led police and information sharing.
  The bill provides the FBI with additional funding to combat financial 
fraud and identity theft. This additional provision of funding is 
responsive to the role that fraud has played in the housing crisis. 
This bill provides the FBI with greater funding to combat fraud. Its 
purpose is to address the corrupt and fraudulent practices of 
``flippers'', ``scam artists'', and ``mortgage fraud rings.''
  President Obama has signaled that he will freeze releasing additional 
TARP funds to AIG because of its mismanagement (i.e., AIG was using 
TARP funds to pay for employees bonuses). The TARP bill proscribed the 
use of the TARP funds and specified that there would be repercussions 
if the TARP funds were used wrongly. There are many companies that used 
these funds inappropriately.
  The fist sign of the crisis that America presently finds itself in 
occurred in March 2008 when investment bank Bear Stearns turned to the 
federal government and competitor JP Morgan Chase for assistance in 
addressing a sudden liquidity crisis. At that time, the Federal Reserve 
provided JP Morgan with funds to complete the merger. Later, in July 
2008, the Federal Deposit Insurance Company seized control of IndyMac, 
the nation's largest home lender.
  In September, the federal government put Fannie Mae and Freddie Mac 
into conservatorship. Since August 2008, the federal government has 
invested billions of dollars into financial institutions. Much of this 
money was given directly to large banking institutions. Other money was 
distributed through the Troubled Asset Relief Program. This program was 
supposed to increase liquidity in the credit and lending markets. Some 
of this money, it was later found was mismanaged and was used to buy 
other banks.
  On October 3, 2008, under the TARP, Congress authorized $700 billion 
for the Treasury to buy troubled assets to prevent further disruption 
in the economy. After the Act was passed, the Administration decided to 
use a portion of the $700 billion to recapitalize some of the nation's 
leading banks by buying their shares. Despite this purchase by the 
government, many banks had no intention of making new loans. In 
allocating the TARP fund, Treasury made a determination about which 
banks would survive and receive funds and which banks, usually smaller, 
would not. By the end of 2008, nine of the largest banks were 
participating in the TARP program. AIG, Bank of America, Citigroup all 
benefitted.
  For some aspects of the present crisis, I believe that there were a 
number of conscious decisions undertaken by bankers, financial 
institutions, and other lenders that have had a direct and adverse 
effect on borrower.
  I also understand that some Mr. and Mrs. Main Street Americans played 
a role. Many made false statements or exaggerated their income or 
engaged in other types of fraud in an effort to secure a mortgage that 
they could not afford. This bill is designed to take an even-handed 
approach and to stamp out fraud, mismanagement, and false statements 
whether they occur on Main Street or Wall Street. I urge my colleagues 
to support it.
  Mr. ISSA. Mr. Speaker, I yield 3 minutes to the distinguished 
gentleman from Texas (Mr. Burgess).
  Mr. BURGESS. I thank the gentleman for yielding.
  Mr. Speaker, I am generally not in favor of commissions. I think 
Congress gives up too much of its power to commissions in my brief 
experience here. But this is one point that I think does call out for a 
commission. Certainly just as egregious as what happened to

[[Page 11836]]

this country on 9/11 was what happened to this country in September 
2008 when we experienced a financial meltdown. And to date, we have not 
looked back into the causes of the crisis and held anyone accountable.
  In fact, Congressman Brady from Texas and myself introduced a bill 
earlier this year for just such a commission, H.R. 2111, that differs 
substantially from the bill under consideration today.
  The bill that we are considering today creates a 10-member commission 
with subpoena power. It is going to be composed of six Democrats and 
four Republicans. When we did the 9/11 Commission, was that not a 50/50 
split with some members being named by agreement amongst the 
commissioners who were already selected? Why would we unbalance this 
commission when, quite frankly, Mr. Speaker, there is just as much 
guilt on one side of the aisle as there is on the other.
  Senate 386 allows the chairman of the Senate Banking Committee to 
select a commissioner. The chairman of the Senate Banking Committee may 
have been part of the problem.
  The bill allows the chairman of the House Financial Services 
Committee to appoint a representative to the commission. Mr. Speaker, 
the chairman of the House Financial Services Committee may have been 
part of the problem.
  Senate 386 creates an accountability commission focused on protecting 
the government. H.R. 2111 creates an accountability commission focused 
on protecting taxpayers and restoring public confidence, something that 
is critical at this juncture.

                              {time}  1445

  Importantly, Mr. Speaker, we do things like this all the time. We 
bring up an important concept and we pass it under suspension of the 
rules. This is an important commission that should be created with all 
due care and caution by this Congress, and then empowered to go out and 
do the work that we want it to do, not slipped in in the middle of a 
very quiet legislative day when Members don't even have any idea what 
they're coming to the floor to vote on.
  I just want to end by quoting from the Investors Business Daily, an 
article entitled, Probe Yourselves, from April 16, 2009. The article 
says, `` `Regulators also deserve blame for lowering lending standards 
that then contributed to riskier home ownership and the housing 
bubble.' Exactly correct.''
  Continuing to quote, ``As such, Pelosi's proposed commission will be 
little more than a fig leaf to cover Congress' own multitude of sins--
letting its Members, the true creators of this financial mess, bash 
business leaders as they pose as populist saviors of Main Street from 
Wall Street.''
  Continuing to quote, ``On NPR Thursday, a reporter confronted 
Representative Frank, chairman of the Financial Services Committee, 
with the fact that his $300 billion `Hope for Homeowners' program''----
  The SPEAKER pro tempore. The time of the gentleman has expired.
  Mr. ISSA. I yield the gentleman 1 additional minute.
  Mr. BURGESS. ``Chairman Frank was asked about his $300 billion `Hope 
for Homeowners' program, passed with much fanfare a year ago that had 
so far helped one homeowner. One. Frank's response: `It was the fault 
of the right.' ''
  Continuing to quote, ``The truth is, Mr. Frank's party has been in 
charge since 2006. And during that time, Democrats have presided over 
one of the most disgraceful and least accomplished Congresses in 
history. This financial mess began on their watch, yet they pretend 
otherwise.''
  Further quoting from the Investors Business Daily, the commission 
that is outlined ``won't get to the bottom of our financial crisis; it 
will carefully select scapegoats to be ritually shamed by the liberal 
media, stripped of their wealth, and exiled. The new rules will be 
imposed that will no doubt make things worse. And the cycle will begin 
again.
  ``Wall Street didn't create this subprime mess, Congress, through 
repeated interventions, did. When the whole thing failed, it was 
Congress' fault.''
  They conclude by saying, ``We'd be happy to support a 9/11-style 
commission to look into the causes of the financial meltdown. But only 
if Congress agrees to put itself under the microscope. Anything less 
would be a sham.''

            [From Investor's Business Daily, Apr. 16, 2009]

                            Probe Yourselves

       Named for its chief counsel, Ferdinand Pecora, the 1932 
     congressional commission dragged influential bankers and 
     stockbrokers before its members for rough questioning--both 
     of their business practices and private lives.
       The Pecora Commission led directly to the Securities Act of 
     1933, the Securities Exchange Act of 1934 and the creation of 
     the Securities Exchange Commission in 1935 to oversee Wall 
     Street.
       Now Pelosi's calling for an encore. ``People are very 
     unhappy with these bailouts,'' she noted, especially the 
     bonuses that went to executives. ``Seventy five percent of 
     the American people, at least, want an investigation of what 
     happened on Wall Street.''
       No doubt, that's true. The problem is, what ``happened on 
     Wall Street'' was a direct result of what happened on Capitol 
     Hill. And we're not the only ones who believe that, by the 
     way.
       ``Government policies, especially the Community 
     Reinvestment Act, and the affordable housing mission that 
     Fannie Mae and Freddie Mac were charged with fulfilling, are 
     to blame for the financial crisis,'' wrote economist Peter 
     Wallison, a fellow at the American Enterprise Institute, 
     recently.
       ``Regulators also deserve blame for lowering lending 
     standards that then contributed to riskier homeownership and 
     the housing bubble.'' Exactly correct.
       As such, Pelosi's proposed commission will be little more 
     than a fig leaf to cover Congress' own multitude of sins--
     letting its members, the true creators of this financial 
     mess, bash business leaders as they pose as populist saviors 
     of Main Street from Wall Street predators.
       Why do this now? Pelosi and her Democrat colleagues are 
     feeling the heat from Tea Party demonstrations and growing 
     voter anger over the massive waste entailed in the $4 
     trillion (and rising) stimulus-bailout bonanza. Again, the 
     Democrats created all this spending. Now, as it proves 
     unpopular, they just walk away from it.
       On NPR Thursday, a reporter confronted Rep. Barney Frank, 
     chairman of the Financial Services Committee, with the fact 
     that his $300 billion ``Hope for Homeowners'' program, passed 
     with much fanfare last fall, had so far helped just one 
     homeowner. One.
       Frank's response: It was the fault of the ``right.'' And 
     Bush.
       Truth is, Frank's party has been in charge since 2006. And 
     during that time, Democrats have presided over one of the 
     most disgraceful and least accomplished Congresses in 
     history. This financial mess began on their watch, yet they 
     pretend otherwise.
       What better way to take the heat off yourself than by 
     pointing accusing fingers at those most unlikable of people--
     Wall Street bankers? That's what the Pelosi-Pecora Commission 
     will do.
       It won't get to the bottom of our financial crisis; it will 
     carefully select scapegoats to be ritually shamed by the 
     liberal media, stripped of their wealth, and exiled. Then new 
     rules will be imposed that will no doubt make things worse. 
     And the cycle will begin again.
       We're not saying Wall Street has no blame for the financial 
     meltdown. But Wall Street didn't create the subprime mess. 
     Congress, through repeated interventions in healthy markets, 
     did. And when the whole thing failed, it was Congress' fault.
       We'd be happy to support a 9/11-style commission to look 
     into the causes of the financial meltdown. But only if 
     Congress agrees to put itself in the dock. Anything less 
     would be a sham.

  Mr. SCOTT of Virginia. I yield 4 minutes to a member of the Judiciary 
Committee, the gentleman from New York (Mr. Maffei).
  Mr. MAFFEI. The Fraud Enforcement Recovery Act of 2009 gives the 
Department of Justice the resources it needs to better combat and 
prevent the kind of financial fraud that has put our economy on its 
heels.
  As I discussed with the bill's sponsors on this legislation in the 
House, however, I do have concerns about amendments like those included 
in this package that expand the reach of an already powerful weapon--
the civil False Claims Act. Often enforced by whistleblowers and their 
private counsel when the Department of Justice steps aside, the civil 
False Claims Act reaches beyond traditional fraud to impose treble 
damages and per claim penalties of $5,500 to $11,000 on individuals, 
corporations, and other legal entities who submit false claims for 
government program funds, knowing or recklessly disregarding the 
falsity of those claims.

[[Page 11837]]

  The power of the False Claims Act comes from its broad terms, low 
burden of proof, enabling the government to impose penalties and recoup 
funds lost not only to frauds, but to less culpable schemes that abuse 
government moneys.
  But there's also a danger in this. Not all whistleblowers and their 
lawyers have the same view of the statute as the Department of Justice 
and the risk of penalties, treble damages, and attorney fees. In many 
cases, the defense costs can cost some defendants to settle charges 
they would otherwise be able to defend.
  One of the things this legislation does is expend that powerful 
weapon to reach schemes that defraud the government of money it pays by 
mistake--of ``overpayments'' that come into the possession of an 
entity, like a university or a research institution, through no fault 
of its own, that the entity keeps and maybe hides rather than notifying 
the government or returning it to the government.
  Drafting language to pursue unlawful retention of an overpayment 
proved difficult, however. When we considered similar legislation in 
committee, I learned that hospitals, universities, and other research 
institutions are among various entities that function in government 
programs where the program rules do require those entities to account 
for overpayments.
  They do so in the form of periodic reports prepared according to 
agency rules that account costs incurred and payments received. This 
allows them to reconcile overpayments and underpayments and, when 
appropriate, repay those overpayments.
  But the drafting problem we faced was avoiding language that would 
impose liability on research institutions or hospitals for holding on 
to overpayments at a time when the applicable rules would allow them to 
do so pending repayment through the normal process.
  This would include reconciliation processes established under 
statutes, regulations, and rules that govern Medicare, Medicaid, and 
all sorts of other various research grants and programs.
  So, as a courtesy to my colleagues, I withdrew an amendment that 
addressed these issues and commenced negotiations to see that any 
amendments to the False Claims Act-protected entities that rely on 
those processes in good faith in handling their accounting, protecting 
them from unwarranted investigations and litigation concerning 
overpayments, they were, in effect, entitled to keep for at least a 
small period of time.
  As reflected in the committee report, the Senate version of this bill 
was amended to afford that protection. A new subsection of the False 
Claims Act will not impose liability for the mere retention of an 
overpayment over the course of the reconciliation period. Rather, the 
new subsection would require proof of a knowing false record or 
statement, of knowing concealment, or of knowing and improper acts to 
avoid or decrease an obligation to pay money to the government.
  So, if a person or entity receives an overpayment from the United 
States and fails to return it immediately and instead takes steps to 
return the overpayment through an applicable reconciliation process, 
then liability would not attach. However, if a person falsifies 
information during a reconciliation period or otherwise acts knowingly 
and improperly to avoid the payment, liability would attach.
  So it's vitally important that we pass this legislation to fight 
financial fraud. But it's also important that we not punish 
universities, hospitals, and other important research institutions when 
they're doing everything that they are supposed to do. We must have 
enforcement and also fairness.
  Mr. ISSA. Mr. Speaker. It's now my privilege to yield 2 minutes to 
the gentleman from Texas (Mr. Gohmert).
  Mr. GOHMERT. I appreciate my friend yielding, and I appreciate all 
the good work that has gone into this bill. I do have concerns about a 
commission that would look into something as important as our financial 
situation, where it ends up being a political commission, 6-4, instead 
of, like, the 9/11 Commission, which was 5-5. That was a bipartisan 
commission that made those findings and were largely supported around 
the country.
  If we're going to make this another political commission, 6-4, then 
aren't we going to get right back into the mess of: Can we trust this? 
Or is this another political report that we're going to spend millions 
and millions of dollars for?
  There are many of us, I think, that can be objective about this. But 
when you have a commission that's 6-4, it's going to get political. 
There's no way around it.
  There's nobody more upset, for example, with the bailout that the 
Republican administration proposed last September. It sure seemed to me 
that AIG should have gone to bankruptcy because they were bankrupt and 
we wouldn't have had the issue of bonuses. We should have let the car 
manufacturers, if they're bankrupt, then we have bankruptcy court.
  And so I was not happy with our administration. I think it would be 
easy to have a commission that would be fair. But when it's 6-4, it's 
unavoidably going to end up political instead of giving us the fair 
analysis that this country really needs.
  Mr. SCOTT of Virginia. I yield 2 minutes to the gentleman from 
Florida (Mr. Klein).
  Mr. KLEIN of Florida. I thank the gentleman. There are serious 
problems with the way some mortgages were sold over this past decade. I 
have heard from constituents who were fully taken advantage of by 
lenders who used a variety of different techniques. Florida, my home 
State, was particularly hard hit by fraud and unscrupulous lenders, 
unfortunately. There's plenty of blame to go around.
  However, on a going-forward basis, we must ensure that these problems 
never happen again, and it's essential that we reform the current 
mortgage underwriting legislation.
  Senator Leahy's legislation and my colleagues in the House here have 
put together an excellent bill, the Fraud Enforcement and Recovery Act, 
which is part of a comprehensive effort to reform mortgage underwriting 
standards and, most importantly, restore consumer and investor 
confidence in the system by expanding criminal penalties for fraudulent 
activity by mortgage brokers and lenders.
  In addition, this bill expands the scope of securities fraud 
provisions and extends the prohibition against defrauding the Federal 
Government to the TARP program and to the stimulus bill.
  The bill also authorizes additional appropriations to investigate and 
prosecute fraud, and creates a Senate Select Committee to examine the 
causes of our current economic crisis.
  All these measures, when taken together, will help restore confidence 
in the American economy, and I urge my colleagues to support this 
legislation so we can get on with business.
  Mr. ISSA. Mr. Speaker, can I inquire how much time I have remaining?
  The SPEAKER pro tempore. The gentleman from California has 9 minutes 
remaining.
  Mr. ISSA. I yield myself such time as I may consume.
  Mr. Speaker, in closing, this legislation is a combination of two 
well thought-out compromises. First of all, the Fraud Enforcement and 
Recovery Act, in fact, is going to take the place of a piece of 
legislation that is far more reaching and, in my opinion, overreaching, 
that passed out of Judiciary just this past week. In fact, by making 
this narrower, what we do is help the whistleblowers and those who 
would support them, while not going too far as to cripple the 
legitimate enforcement by cities and States and the right for them to 
discover waste, fraud and abuse themselves, make those in corrections 
without seeing both punitive fines and perhaps 30 percent going to 
plaintiffs' trial lawyers.
  The fact is, Mr. Speaker, this narrowing is a good compromise coming 
from the Senate, and I want to thank all of those in both parties who 
worked on this. I think it makes moot the legislation that was passed 
under Judiciary.
  Secondly, another compromise, and one that I want to speak to, this 
9/11-

[[Page 11838]]

style commission, something that, as you can see, many people on both 
sides of the aisle--on both sides of the Capitol--thought was 
necessary. Over the last period of months, we have seen the Speaker of 
the House going from not supporting, and supporting only that her 
committee chairmen do the work, to supporting the concept of a House 
committee, to then a House-Senate committee, and, finally, I believe 
today, support for something that gets it almost right.
  Mr. Speaker, I believe that, on nearing the third anniversary of the 
9/11 Commission, we should begin looking at what we did in the 9/11 
Commission.
  In 2007, on the third anniversary, Speaker Pelosi praised the 
bipartisan, independent commission for its work, calling the 
recommendations made by the commission earned and achievable, and, in 
fact, speaking to its bipartisan nature.
  This year, as we pass legislation to make a similar-type commission 
to deal with the meltdown last year in our markets, I would call on 
Speaker Pelosi to help make the balance right.
  As was previously stated, based on the current nominating system in 
the ordinary course, this would end up being a 6-4 split and be 
questioned by the American people as to whether or not it was 
Democratically led and Democratically dominated.
  The Speaker has the ability, with her three appointments, to make 
this right, either by appointing one Republican and one Democrat, or, 
in this case, two; or I might suggest that even if she cannot find a 
Republican appropriate to be appointed from her allocation, that she 
could look to an independent or somebody independent of party politics.
  I have previously supported, when asked, Sandra Day O'Connor, a 
retired Justice, or somebody of her stature who rises well above party 
politics, who may be considered to have some Republican background but 
who, clearly, in the eyes of the American people, would be a consensus-
builder, able to look for the truth and look for compromise so as to 
reach the consensus, not a majority decision, but a consensus of this 
commission, as in almost every case--I believe in every case--the 9/11 
Commission did.

                              {time}  1500

  I understand that this bill is the best bill we can get here today 
and I intend to vote for it, support it, and urge my colleagues to 
support it; not because I don't believe it should be above party 
politics and should be a 5-5 split, but because this is so much better 
than nothing at all and because I believe that the Speaker has it 
within her appointment powers to make this a perfectly good commission, 
one that we can all be proud of, and one that lives up to exactly what 
Speaker Pelosi asked for when the shoe was on the other foot after 
September 11, when we were looking at the need to get above party 
politics and we were looking to find people of stature to appoint.
  Mr. Speaker, I hope my suggestions over and above my support for this 
legislation will be heeded.
  Mr. Speaker, S. 386, the Fraud Enforcement and Recovery Act of 2009, 
improves current criminal and civil fraud statutes to help the federal 
government bring predatory lenders and unscrupulous financial 
institutions to justice.
  Judiciary Chairman Conyers and Ranking Member Smith sponsored the 
companion legislation in the House, H.R. 1748, the Fight Fraud Act of 
2009. The bill before the House today is a true example of bipartisan, 
bicameral cooperation.
  S. 386, as amended, merges these two important pieces of legislation 
together to provide comprehensive and effective solutions to combating 
mortgage fraud, securities fraud, and other financial crimes.
  In times of crisis, crime often flourishes. Following the 9/11 
terrorist attacks and Hurricane Katrina, unscrupulous people chose to 
exploit these tragedies to pad their pockets with money intended to 
help the victims.
  The country's housing crisis is no exception. America's economic 
downturn, brought on by the housing crisis and other factors, exposed a 
significant amount of fraud and corruption within the mortgage, 
banking, and securities industries.
  The drive for expanded homeownership along with unchecked lending 
practices and inflated property values, encouraged mortgage fraud, 
predatory lending, and institutional corruption.
  Mortgage fraud comes in many forms, including deceptive practices by 
borrowers, predatory lending and institutional fraud.
  And now, the fraud is spreading to schemes targeting homeowners who 
are facing foreclosure as a result of the plummeting housing market. 
Foreclosure scams are targeting cash-strapped consumers on the verge of 
losing their homes. Victims are lured into the fraud scheme with 
promises of financial assistance that never materializes.
  S. 386 amends federal fraud statutes to specifically prohibit false 
statements by mortgage brokers and agents of mortgage lending 
businesses.
  The bill also expands the major fraud statutes to include fraud 
against the Troubled Assets Relief Program, economic stimulus funds, or 
other federal rescue or recovery plans.
  The Fight Fraud Act authorizes additional funds for federal law 
enforcement agencies, the Departments of Justice and Housing and Urban 
Development, and the Securities and Exchange Commission.
  This legislation promotes the ongoing investigative partnerships 
between federal, state and local law enforcement agencies.
  The bill also supports programs that provide critical training and 
investigative support services, intelligence services, research support 
and other resources necessary to investigating these financial crimes.
  Additionally, this legislation will strengthen the liability 
provisions of the False Claims Act as well as make some necessary 
technical changes to the Act.
  The False Claims Act provisions in this bill will undoubtedly enhance 
the Federal government's ability to recover government money and 
property that would otherwise be lost to waste, fraud, or abuse.
  What's more, these provisions do so in a responsible manner that will 
not encourage the filing of frivolous or unfounded False Claims Act 
cases.
  Simply put, the False Claims Act provisions in this bill go the 
proper distance in ensuring that the Act remains a viable tool in the 
government's continuing fight to protect taxpayer dollars from fraud.


                              (COMMISSION)

  The Fraud Enforcement and Recovery Act also contains provisions to 
create a bipartisan, independent ``Financial Markets Commission.''
  This Commission will examine the questions of ``Why?'' and ``How?'' 
the current financial and economic crisis occurred.
  We have seen the success of past blue-ribbon panels, such as the 9/11 
Commission.
  In 2007, on the 3rd anniversary of the 9/11 Commission report, 
Speaker Pelosi praised the bipartisan, independent Commission for its 
work--calling the recommendations made by the Commission ``urgent and 
achievable'' making the country more ``unified'' and ``effective.''
  Speaker Pelosi is right. A bipartisan, independent commission can 
produce valuable results.
  Which is why I proposed a similar bill last fall and again this 
Congress, H.R. 74.
  I view the effort to create this commission as a vehicle for this 
Congress to demonstrate a willingness to set aside partisanship and put 
the interests of our country first.
  As with the 9/11 Commission, the Financial Markets Commission report 
should be free of accusations of political showmanship and a partisan 
slant that have tainted current investigations.
  This Commission is not the place for partisanship OR Congressional 
meddling.
  It is a place for the American people to get answers.
  Ideally, in today's bill, the composition of this Commission would 
have been bipartisan down the line, with a 5-5 split like the 9/11 
Commission that was adopted by a Republican Congress instead of the 6-4 
divide that has come to the floor today at the direction of the 
Democratic Leadership.
  Speaker Pelosi said in 2005, when discussing a possible Commission to 
review Hurricane Katrina events, a ``real commission'' is bipartisan 
and independent.
  The decision to depart from the 5-5 model of the 9/11 commission in 
favor of a commission whose composition has a partisan slant is 
disappointing.
  But I believe the credibility of this commission's report will still 
depend on its ability to deliver conclusions and recommendations that 
all the members of the commission will embrace.
  I am hopeful that the members of Congress who will be responsible for 
appointments to this Commission will ensure that the panel's 
composition is bipartisan, independent, and focused on producing a 
nonpartisan report--not scoring political points.

[[Page 11839]]

  In closing, The Fraud Enforcement and Recovery Act of 2009 is a good 
government bill.
  I urge my colleagues to support this legislation.
  I yield back the balance of my time.
  Mr. SCOTT of Virginia. Mr. Speaker, finally, in closing, I would 
remind the body that this is a bipartisan, bicameral consensus. We have 
worked together on a bipartisan basis in the House and the Senate.
  The bill will prevent fraud by clarifying the fraud statutes and 
strengthen the False Claims Act. It will, I think very importantly, 
provide significant resources for fighting the fraud.
  Finally, the value of the commission will be judged by its product, 
and we would all assume that the appointments would be people whose 
reputation is beyond reproach and we will get a good product from the 
commission.
  With that, Mr. Speaker, I urge my colleagues to support the bill.
  Mr. AL GREEN of Texas. Mr. Speaker, I am proud to support S. 386, the 
Fraud Enforcement and Recovery Act of 2009.
  The bursting of the housing bubble and the subsequent deterioration 
of the economy revealed fundamental weaknesses in our mortgage and 
financial industries. Predatory lending and discriminatory practices 
coupled with a lack of regulation and oversight resulted in many people 
being steered towards loans that they could not afford, or being given 
higher cost loans than they qualified for.
  Fraud, by definition, is the crime or offense of deliberately 
deceiving another in order to damage them--usually to obtain property 
or services unjustly. The practices that I just discussed certainly fit 
this definition.
  Mr. Speaker, during the height of the housing bubble, many were 
blinded by greed, and their actions played a large role in bringing 
about the economic hardships that we hear about on a daily basis. We 
must never allow such practices to happen again, and those guilty of 
mortgage fraud should be sought out and prosecuted.
  This bill would do precisely that. It would expand the definition of 
``financial institution'' to include mortgage lending businesses or any 
person who makes federally related mortgage loans. It also extends the 
prohibition of providing false information for mortgage documents to 
employees and agents of the mortgage lending business.
  This bill also takes a comprehensive approach to investigating and 
enforcing mortgage fraud. It authorizes monies for a wide swath of 
government agencies to strengthen their individual efforts and 
therefore strengthening their collective efforts.
  Mr. Speaker, much work remains to be done as we move forward, and 
while this piece of legislation is not the be-all-end-all solution, it 
is a meaningful first step, and I support it in full.
  I thank my friend and colleague Representative John Conyers Jr. for 
introducing this legislation.
  Mr. VAN HOLLEN. Mr. Speaker, today, I rise to support S. 386, the 
Fraud Enforcement and Recovery Act of 2009.
  As the country continues to recover from the current economic crisis, 
we need to do everything possible to understand all the factors that 
caused the financial meltdown and ensure that the appropriate laws and 
resources are in place to prevent a similar crisis in the future. We 
have also made an unprecedented investment of taxpayer dollars as part 
of our economic recovery effort, and we must ensure that this 
investment is spent wisely and efficiently.
  We know that lax supervision of the financial industry contributed to 
the current economic conditions, and we must do everything we can to 
learn from these mistakes and prevent future economic meltdowns. This 
bill will help us understand the causes of the economic crisis by 
establishing a bipartisan commission to study the conditions that 
triggered the economic collapse. The Commission will also provide 
Congress with recommendations to prevent future economic problems.
  The legislation also includes a clear commitment to fighting waste, 
fraud and abuse. It strengthens current law and increases funding to 
hire investigators and prosecutors so law enforcement agencies can 
effectively combat these issues. It will also help protect taxpayer 
dollars by amending current law to protect funds expended under the 
Troubled Asset Relief Program (TARP) and the economic stimulus package.
  The Fraud Enforcement and Recovery Act of 2009 will help the 
government increase its understanding of the factors that caused the 
economic collapse, and provide the resources necessary to help prevent 
this from happening again. I urge my colleagues to join me in 
supporting this important legislation.
  Mr. DINGELL. Mr. Speaker, I rise in support of S. 386, the Fraud 
Enforcement and Recovery Act. This legislation provides the Department 
of Justice with the tools it needs to fight fraud in the use of funds 
under the Troubled Asset Relief Program, TARP, and the American 
Recovery and Reinvestment Act. S.386 has a number of provisions that 
seek to protect Americans by ensuring the agencies tasked with 
investigating and prosecuting mortgage and financial fraud have the 
funding and personnel they need to do so. I am also pleased the House 
recognizes the need for increased accountability for mortgage lending 
businesses not directly regulated or insured by the Federal Government, 
an industry responsible for nearly half the residential mortgage market 
before the housing crash.
  I am more hesitant to support other provisions of S. 386. This bill 
includes an amendment to establish a special commission to investigate 
the causes of the current financial crisis. I believe that any such 
commission should be comprised of members of this body, who are 
furthermore from the committees of jurisdiction relevant to the matter. 
I have introduced a resolution, H. Res. 345, to do precisely that. It 
is my long-held belief that the Congress should, contrary to the 
prevailing fashion of the times, conduct its own oversight work. For 
the simple fact that members of this body will ultimately write the 
legislation to re-impose a strict regulatory framework upon the 
financial services industry, they should be personally involved in 
vigorous efforts to expose the many and sundry causes of this country's 
recent economic collapse. In brief, well-informed members of Congress 
write more effective legislation.
  With this in mind, I voice my support for aggressive oversight of the 
financial services industry, but respectfully object to the manner in 
which S. 386, as amended, mandates it be performed.
  Mr. SCOTT of Virginia. I yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Virginia (Mr. Scott) that the House suspend the rules 
and pass the Senate bill, S. 386, as amended.
  The question was taken.
  The SPEAKER pro tempore. In the opinion of the Chair, two-thirds 
being in the affirmative, the ayes have it.
  Mr. ISSA. 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 and the 
Chair's prior announcement, further proceedings on this motion will be 
postponed.

                          ____________________