[House Report 114-547]
[From the U.S. Government Publishing Office]
114th Congress } { Rept. 114-547
HOUSE OF REPRESENTATIVES
2d Session } { Part 1
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KINGPIN DESIGNATION IMPROVEMENT ACT OF 2016
_______
May 10, 2016.--Ordered to be printed
_______
Mr. Goodlatte, from the Committee on the Judiciary, submitted the
following
R E P O R T
[To accompany H.R. 4985]
[Including cost estimate of the Congressional Budget Office]
The Committee on the Judiciary, to whom was referred the
bill (H.R. 4985) to amend the Foreign Narcotics Kingpin
Designation Act to protect classified information in Federal
court challenges, having considered the same, reports favorably
thereon without amendment and recommends that the bill do pass.
CONTENTS
Page
Purpose and Summary.............................................. 1
Background and Need for the Legislation.......................... 2
Hearings......................................................... 2
Committee Consideration.......................................... 3
Committee Votes.................................................. 3
Committee Oversight Findings..................................... 3
New Budget Authority and Tax Expenditures........................ 3
Congressional Budget Office Cost Estimate........................ 3
Duplication of Federal Programs.................................. 4
Disclosure of Directed Rule Makings.............................. 4
Performance Goals and Objectives................................. 4
Advisory on Earmarks............................................. 5
Section-by-Section Analysis...................................... 5
Changes in Existing Law Made by the Bill, as Reported............ 5
Purpose and Summary
H.R. 4985 amends Section 804 of the Foreign Narcotics
Kingpin Designation Act (the ``Kingpin Act'')\1\ to include
language, which is identical to the language currently in a
related Federal statute, to protect classified information from
disclosure during a Federal court challenge by an individual
who has been designated pursuant to the Kingpin Act. The
amendment will allow the government to submit classified
information ex parte and in camera in U.S. district court.
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\1\21 U.S.C. Sec. 1903.
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Background and Need for the Legislation
In December 1999, after the Treasury Department's Office of
Foreign Assets Control (OFAC) had successfully used its
authorities under the International Emergency Economic Powers
Act (IEEPA)\2\ to target and apply sanctions to several
international narcotics traffickers and their organizations
that were operating in Colombia,\3\ Congress decided that
similar authorities should be used worldwide. Congress passed
the Kingpin Act,\4\ which today is the principal mechanism by
which OFAC sanctions foreign persons tied to global narcotics
trafficking.
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\2\50 U.S.C. Sec. 1701 et seq.
\3\See https://www.treasury.gov/resource-center/sanctions/Programs/
Documents/drugs.TXT.
\4\21 U.S.C. Sec. Sec. 1901-1908, 8 U.S.C. Sec. 1182.
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Since June 2000, OFAC has designated more than 1,800
persons under the Kingpin Act, all of whom are non-U.S.
persons. The list of designated individuals is a public
list.\5\ Whenever OFAC makes a designation, the list is updated
and distributed in various forms to banks and financial
institutions. OFAC designation under the Kingpin Act generally
precludes a listed individual from using the U.S. financial
system.\6\ Listed individuals are permitted to seek removal of
the OFAC sanctions via a ``de-listing'' process and challenge
adverse findings in Federal court.\7\
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\5\See https://www.treasury.gov/resource-center/sanctions/Programs/
Documents/narco_designa
tions_kingpin.pdf.
\6\21 U.S.C. Sec. 1904.
\7\31 C.F.R. Sec. 501.807.
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OFAC's designations, under both IEEPA and the Kingpin Act,
are often based upon classified information.\8\ Under IEEPA,
OFAC is permitted to submit such information ex parte and in
camera to a court.\9\ However, the Kingpin Act does not contain
such a mechanism to protect classified information from release
during a ``de-listing'' process. That means OFAC may lose the
opportunity to designate a high-level drug kingpin because it
cannot risk the disclosure of classified information.
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\8\18 U.S.C. app. Sec. 1(a) (1980) (```Classified information', as
used in this Act, means any information or material that has been
determined by the United States Government pursuant to an Executive
order, statute, or regulation, to require protection against
unauthorized disclosure for reasons of national security and any
restricted data, as defined in paragraph r. of section 11 of the Atomic
Energy Act of 1954 (42 U.S.C. 2014(y)).'').
\9\50 U.S.C. Sec. 1702(c).
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H.R. 4895 would address this issue by making it clear that
OFAC can submit classified information to defend its
designations ex parte and in camera in the relevant U.S.
district court, thereby harmonizing the Kingpin Act with the
OFAC authorities under IEEPA and protecting classified
information from disclosure. Such protections are critical to
defend Kingpin Act designations based upon classified
information.
Hearings
The Committee on the Judiciary held no hearings on H.R.
4985.
Committee Consideration
On April 20, 2016, the Committee met in open session and
ordered the bill H.R. 4985 favorably reported, without
amendment, by voice vote, a quorum being present.
Committee Votes
In compliance with clause 3(b) of rule XIII of the Rules of
the House of Representatives, the Committee advises that there
were no recorded votes during the Committee's consideration of
H.R. 4985.
Committee Oversight Findings
In compliance with clause 3(c)(1) of rule XIII of the Rules
of the House of Representatives, the Committee advises that the
findings and recommendations of the Committee, based on
oversight activities under clause 2(b)(1) of rule X of the
Rules of the House of Representatives, are incorporated in the
descriptive portions of this report.
New Budget Authority and Tax Expenditures
Clause 3(c)(2) of rule XIII of the Rules of the House of
Representatives is inapplicable because this legislation does
not provide new budgetary authority or increased tax
expenditures.
Congressional Budget Office Cost Estimate
In compliance with clause 3(c)(3) of rule XIII of the Rules
of the House of Representatives, the Committee sets forth, with
respect to the bill, H.R. 4985, the following estimate and
comparison prepared by the Director of the Congressional Budget
Office under section 402 of the Congressional Budget Act of
1974:
U.S. Congress,
Congressional Budget Office,
Washington, DC, May 6, 2016.
Hon. Bob Goodlatte, Chairman,
Committee on the Judiciary,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 4985, the
``Kingpin Designation Improvement Act of 2016.''
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Marin
Burnett, who can be reached at 226-2860.
Sincerely,
Keith Hall,
Director.
Enclosure
cc:
Honorable John Conyers, Jr.
Ranking Member
H.R. 4985--Kingpin Designation Improvement Act of 2016.
As ordered reported by the House Committee on the Judiciary
on April 20, 2016.
H.R. 4985 would allow the Office of Foreign Assets Control
(OFAC) in the Department of the Treasury to submit classified
information in certain court cases involving narcotics
trafficking in a manner that would protect it from disclosure.
Currently, OFAC has the authority to apply certain
sanctions to persons found to have been involved with narcotics
trafficking under both the International Emergency Economic
Powers Act (IEEPA) and the Foreign Narcotics Kingpin
Designation Act (the ``Kingpin"Act.) In court proceedings
involving persons sanctioned under IEEPA, OFAC is permitted to
protect certain information from disclosure; for persons
sanctioned under the Kingpin Act, OFAC is not permitted to do
so.
H.R. 4985 would amend the Kingpin Act to allow OFAC to
protect classified information in court proceedings, in the
same manner such information is protected under IEEPA. CBO
estimates that enacting the bill would have no significant
effect on the Federal budget because it would have a negligible
effect on the workload of the U.S. courts.
Because enacting H.R. 4985 would not affect direct spending
or revenues, pay-as-you-go procedures do not apply. CBO
estimates that enacting H.R. 4985 would not increase net direct
spending or on-budget deficits in any of the four consecutive
10-year periods beginning in 2027.
H.R. 4985 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act and
would not affect the budgets of State, local, or tribal
governments.
The CBO staff contact for this estimate is Marin Burnett.
The estimate was approved by H. Samuel Papenfuss, Deputy
Assistant Director for Budget Analysis.
Duplication of Federal Programs
No provision of H.R. 4985 establishes or reauthorizes a
program of the Federal Government known to be duplicative of
another Federal program, a program that was included in any
report from the Government Accountability Office to Congress
pursuant to section 21 of Public Law 111-139, or a program
related to a program identified in the most recent Catalog of
Federal Domestic Assistance.
Disclosure of Directed Rule Makings
The Committee estimates that H.R. 4985 specifically directs
to be completed no specific rule makings within the meaning of
5 U.S.C. Sec. 551.
Performance Goals and Objectives
The Committee states that pursuant to clause 3(c)(4) of
rule XIII of the Rules of the House of Representatives, H.R.
4985 amends the Foreign Narcotics Kingpin Designation Act to
protect classified information in Federal court challenges.
Advisory on Earmarks
In accordance with clause 9 of rule XXI of the Rules of the
House of Representatives, H.R. 4985 does not contain any
congressional earmarks, limited tax benefits, or limited tariff
benefits as defined in clause 9(e), 9(f), or 9(g) of Rule XXI.
Section-by-Section Analysis
Section 1. Short Title. This section cites the short title
of the bill as the ``Kingpin Designation Improvement Act of
2016.''
Section 2. Protection of Classified Information. This
section amends Section 804 of the Foreign Narcotics Kingpin
Designation Act\10\ to include language protecting classified
information from disclosure during a Federal court challenge by
a designee. The language, which is identical to the language
currently in the International Emergency Economic Powers Act,
will allow the government to submit classified information ex
parte and in camera in U.S. district court.
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\10\21 U.S.C. Sec. 1903.
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Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (new matter is
printed in italics and existing law in which no change is
proposed is shown in roman):
FOREIGN NARCOTICS KINGPIN DESIGNATION ACT
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TITLE VIII--INTERNATIONAL NARCOTICS TRAFFICKING
* * * * * * *
SEC. 804. PUBLIC IDENTIFICATION OF SIGNIFICANT FOREIGN NARCOTICS
TRAFFICKERS AND REQUIRED REPORTS.
(a) Provision of Information to the President.--The
Secretary of the Treasury, the Attorney General, the Secretary
of Defense, the Secretary of State, and the Director of Central
Intelligence shall consult among themselves and provide the
appropriate and necessary information to enable the President
to submit the report under subsection (b). This information
shall also be provided to the Director of the Office of
National Drug Control Policy.
(b) Public Identification and Sanctioning of Significant
Foreign Narcotics Traffickers.--Not later than June 1, 2000,
and not later than June 1 of each year thereafter, the
President shall submit a report to the Permanent Select
Committee on Intelligence, and the Committees on the Judiciary,
International Relations, Armed Services, and Ways and Means of
the House of Representatives; and to the Select Committee on
Intelligence, and the Committees on the Judiciary, Foreign
Relations, Armed Services, and Finance of the Senate--
(1) identifying publicly the foreign persons that
the President determines are appropriate for sanctions
pursuant to this title; and
(2) detailing publicly the President's intent to
impose sanctions upon these significant foreign
narcotics traffickers pursuant to this title.
The report required in this subsection shall not include
information on persons upon which United States sanctions
imposed under this title, or otherwise on account of narcotics
trafficking, are already in effect.
(c) Unclassified Report Required.--The report required by
subsection (b) shall be submitted in unclassified form and made
available to the public.
(d) Classified Report.--(1) Not later than July 1, 2000,
and not later than July 1 of each year thereafter, the
President shall provide the Permanent Select Committee on
Intelligence of the House of Representatives and the Select
Committee on Intelligence of the Senate with a report in
classified form describing in detail the status of the
sanctions imposed under this title, including the personnel and
resources directed towards the imposition of such sanctions
during the preceding fiscal year, and providing background
information with respect to newly-identified significant
foreign narcotics traffickers and their activities.
(2) Such classified report shall describe actions the
President intends to undertake or has undertaken with respect
to such significant foreign narcotics traffickers.
(3) The report required under this subsection is in
addition to the President's obligations to keep the
intelligence committees of Congress fully and currently
informed pursuant to the provisions of the National Security
Act of 1947.
(e) Exclusion of Certain Information.--
(1) Intelligence.--Notwithstanding any other
provision of this section, the reports described in
subsections (b) and (d) shall not disclose the identity
of any person, if the Director of Central Intelligence
determines that such disclosure could compromise an
intelligence operation, activity, source, or method of
the United States.
(2) Law enforcement.--Notwithstanding any other
provision of this section, the reports described in
subsections (b) and (d) shall not disclose the name of
any person if the Attorney General, in coordination as
appropriate with the Director of the Federal Bureau of
Investigation, the Administrator of the Drug
Enforcement Administration, and the Secretary of the
Treasury, determines that such disclosure could
reasonably be expected to--
(A) compromise the identity of a confidential
source, including a State, local, or foreign agency or
authority or any private institution that furnished
information on a confidential basis;
(B) jeopardize the integrity or success of an
ongoing criminal investigation or prosecution;
(C) endanger the life or physical safety of any
person; or
(D) cause substantial harm to physical property.
(f) Notification Required.--(1) Whenever either the
Director of Central Intelligence or the Attorney General makes
a determination under subsection (e), the Director of Central
Intelligence or the Attorney General shall notify the Permanent
Select Committee on Intelligence of the House of
Representatives and the Select Committee on Intelligence of the
Senate, and explain the reasons for such determination.
(2) The notification required under this subsection shall
be submitted to the Permanent Select Committee on Intelligence
of the House of Representatives and the Select Committee on
Intelligence of the Senate not later than July 1, 2000, and on
an annual basis thereafter.
(g) Determinations Not To Apply Sanctions.--(1) The
President may waive the application to a significant foreign
narcotics trafficker of any sanction authorized by this title
if the President determines that the application of sanctions
under this title would significantly harm the national security
of the United States.
(2) When the President determines not to apply sanctions
that are authorized by this title to any significant foreign
narcotics trafficker, the President shall notify the Permanent
Select Committee on Intelligence, and the Committees on the
Judiciary, International Relations, Armed Services, and Ways
and Means of the House of Representatives, and the Select
Committee on Intelligence, and the Committees on the Judiciary,
Foreign Relations, Armed Services, and Finance of the Senate
not later than 21 days after making such determination.
(h) Changes in Determinations to Impose Sanctions.--
(1) Additional determinations.--(A) If at any time
after the report required under subsection (b) the
President finds that a foreign person is a significant
foreign narcotics trafficker and such foreign person
has not been publicly identified in a report required
under subsection (b), the President shall submit an
additional public report containing the information
described in subsection (b) with respect to such
foreign person to the Permanent Select Committee on
Intelligence, and the Committees on the Judiciary,
International Relations, Armed Services, and Ways and
Means of the House of Representatives, and the Select
Committee on Intelligence, and the Committees on the
Judiciary, Foreign Relations, Armed Services, and
Finance of the Senate.
(B) The President may apply sanctions authorized
under this title to the significant foreign narcotics
trafficker identified in the report submitted under
subparagraph (A) as if the trafficker were originally
included in the report submitted pursuant to subsection
(b) of this section.
(C) The President shall notify the Secretary of the
Treasury of any determination made under this
paragraph.
(2) Revocation of determination.--(A) Whenever the
President finds that a foreign person that has been
publicly identified as a significant foreign narcotics
trafficker in the report required under subsection (b)
or this subsection no longer engages in those
activities for which sanctions under this title may be
applied, the President shall issue public notice of
such a finding.
(B) Not later than the date of the public notice
issued pursuant to subparagraph (A), the President
shall notify, in writing and in classified or
unclassified form, the Permanent Select Committee on
Intelligence, and the Committees on the Judiciary,
International Relations, Armed Services, and Ways and
Means of the House of Representatives, and the Select
Committee on Intelligence, and the Committees on the
Judiciary, Foreign Relations, Armed Services, and
Finance of the Senate of actions taken under this
paragraph and a description of the basis for such
actions.
(i) Protection of Classified Information in Federal Court
Challenges Relating to Designations.--In any judicial review of
a determination made under this section, if the determination
was based on classified information (as defined in section 1(a)
of the Classified Information Procedures Act) such information
may be submitted to the reviewing court ex parte and in camera.
This subsection does not confer or imply any right to judicial
review.
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